Tag Archives: housing

Business/Economics, International

Another reason the housing market bubble in China could burst: New Income Tax Laws

Recently the Chinese government changed income tax laws, to help low income workers keep more of their money.  The new law increased the number of workers who don’t have to file income tax.

The Chinese real estate industry is now warning that could reduce property sales.

In China you must have official papers declaring you a permanent resident of the area you want to buy property in.  If you don’t have such paperwork, you can use your income tax filing to show that you work in that area.  The problem with the new tax law is that it will reduce the number of migrant workers who would’ve had those tax records to use to buy a home with.

A Beijing realtor says the new tax law will reduce the number of qualified migrants, in his area, by more than 90%.

This comes after the Chinese government ordered banks to tighten mortgage lending by either increasing down payments, or increasing mortgage interest rates.

Business/Economics, International

What Economic Recovery? Chinese credit crunch could burst Chinese housing market bubble

In an effort to fight inflation the Chinese government recently ordered banks to tighten their grip on the money supply.  One way is to cut back on loans.

The China Construction Bank announced they will increase down payments on homes, for first time buyers, to 40% of the purchase price.  The Chinese banks were told to either raise the amount of down payments, or increase interest rates on mortgages.  This could pop China’s housing market bubble.

Business/Economics, Idaho, U.S.

What Economic Recovery? Eastern Idaho has increase in people needing help with housing

“People aren’t feeling as comfortable getting a mortgage because they don’t know for sure what the future of their employment is going to be.”-Debra Hemmert, Southeastern Idaho Community Action Agency

In the Pocatello area, Hemmert says the amount of people asking for help with housing has doubled this year.

Sheryl Bailey, with the Eastern Idaho Community Action Partnership, says they’re seeing the same thing in the Idaho Falls area.

There is no state taxpayer funded housing assistance program in Idaho.  There is the Idaho Housing and Finance Association, which offers Federal HUD Section 8 assistance program, but only in 34 of Idaho’s 44 counties.  Also, the IHFA has two apartment units, one in Idaho Falls, the other in Kellogg.

The city of Boise, and the county of Ada, run a joint Housing Authority, which actually serves as a way to match people with Federally funded government programs, and non-profit assistance.  Most housing assistance in Idaho comes from non-profits who rely on donations and government grants.

Business/Economics, Idaho, U.S.

What Economic Recovery? Idaho leads United States in falling Home Prices

There’s been more news about the continued falling home prices in the U.S.  One company that tracks those prices says Idaho is the biggest loser.

Corelogic reports that for April 2011, Idaho home prices fell 15.2% compared to April 2010.  It’s also twice the current average for the entire United States.

According to the Center of Business Research and Economic Development at Boise State University, most of Idaho’s home sales, prior to the housing market bubble burst, were actually being driven by “second home” buying and real estate speculation.

When the bubble burst those kind of sales stopped.  Now Idaho is looking at a more realistic picture of property sales, which is reflecting the overall bad economy.

Business/Economics, U.S.

What Economic Recovery? U.S. home foreclosures hit record levels year after year

Reality Trac says U.S. property foreclosures hit 3.82 million in 2010.  A record.

It’s a continuing trend since 2006. The percentage of foreclosure filings just keeps going up: 2.23% of all U.S. housing units received at least one foreclosure filing during 2010.  2.21% in 2009.  1.84% in 2008.  1.03% in 2007.  0.58% in 2006.

The top five states for foreclosures in 2010 are: California, Florida, Arizona, Illinois and Michigan.

Business/Economics, U.S.

Proof the housing market is still crashing; Fannie Mae wants another $8.5 billion bailout

The top mortgage lender in the United States, Fannie Mae, wants another $8.5 billion dollars to save its butt.  This after reporting a loss of $6.5 billion during the first three months of 2011.

Fannie Mae blames the loss on credit expenses. They also blame falling home prices.  If Fannie Mae gets the new bailout money (at taxpayer’s expense) it will make it the costliest government bailout, of a single company, in U.S. history; $99.7 billion.

 

Business/Economics, International, U.S.

U.S. housing contractors may profit from Japan disaster

The Japanese government announced that in order to build enough temp homes, fast enough, they will have to use foreign contractors.

The temporary homes are needed for survivors of the March 11 disasters, and people who have, and others who still might have to, evacuate from radiation danger zones.

The Land and Infrastructure Ministry said foreign contractors must meet certain conditions. They must have the capacity to build more than 100 units in 2 months, and they must meet Japanese electrical codes. On top of that they must form joint partnerships with Japanese contractors.

Local governments will be taking bids.

Business/Economics, Opinion, U.S.

Economy About to Crash? What Happened to Recovery? 10 Reasons

March 10, 2011.

“I think this is the beginning of something severe.” said chief investment strategist at Windham Financial Services, Paul Mendelsohn. He’s referring to the more than 220 point drop in the DOW, which got little to no mention in national TV news coverage on March 10. There’s a lot of legitimate reasons for investors getting out of the market, not just in the U.S., but world wide. Those reasons also prove that there is no economic recovery.

Reason 1: First time jobless claims, in the U.S., for state benefits went up, more than expected (again).

Reason 2: World wide unemployment is high. Most of the violence around the world involves unemployment. The current crisis in North Africa and the Middle East is due, in part, to high unemployment rates. In 2010 Macedonia took the top spot with an official unemployment rate of 33.8%. How can the global economy recover when there are so many people not making any money to buy things with?

Reason 3: U.S. trade deficit increased (again).

Reason 4: China’s trade deficit increased (a surprise).

Reason 5: Credit ratings for Greece and Spain decreased (again).

Reason 6: Oil prices remain high, and still look to go higher (it’s interesting how analysts predicted the increase in price, without even considering, or knowing, that there would be a “revolutionary” crisis affecting many oil producing countries, or did they, mmmm?)

Reason 7: Food prices are increasing, worldwide. The UN (United Nations) says it does not see any improvement in food supply worldwide. I have read that Chinese wheat farmers will have only enough harvest for subsistence in 2011, nothing left over to sell. Across the world the food supply (“supply” is the key word, because some areas have plenty of crops but they aren’t getting to market) situation is getting worse for a number of reasons, from climate change, to the cost of transportation, to lack of credit, to political/social instability. A new problem adding to food supply issues is that migrant workers are not working. This is due to things like anti-migrant attitudes in the U.S., and the increasing violence in North Africa and the Middle East.

Reason 8: Union busting in the United States. Why should this be considered a factor? Because the goal of union busting is to reduce pay and benefits for employees. If workers are going to be making even less than what they are now, then that’s less they’ll spend while shopping. Gee, isn’t the U.S. economy a “consumer” based economy, which would mean the more a worker spends the better it is for the economy?

Reason 9: Stagnant pay for 90% of U.S. workers. Recently the IRS (Internal Revenue Service) reported that their own study, into the wages and salaries of taxpayers, reveled that 90% of taxpayers had no increase in pay in the past 20 years (when adjusted for inflation). The study also showed that the top 5% of taxpayers saw a 33% increase in earnings over the same period (also adjusted for inflation). Basic economics states that for an economy to do well the money in the system needs to go through as many hands as possible. Clearly the money is staying at the top and not trickling down.

Reason 10: This is probably a very important sign that there is no U.S. economic recovery. The world’s largest bond fund, PIMCO’s Total Return Fund, dumped all its U.S. government bonds, then moved into cash/cash equivalent big time. Why is that important? PIMCO used to be the biggest holder of U.S. bonds. That’s because they trusted that the U.S. government could pay its debts. By selling ALL its U.S. bonds PIMCO is indicating that they don’t think the U.S. government can pay back its debts. PIMCO has actually told other investors to get out of U.S. bonds. Not good. The move into cash is a traditional investor’s way of preparing for the worst. How much did PIMCO move into cash? In January PIMCO’s cash holdings were about 5%, now they are at 23%, a big jump. PIMCO is now selling off mortgage backed securities, this indicates that PIMCO is expecting another drop in the housing market.

There are plenty of other reason to list, you can do your own homework. Some of my sources: Voice of America, Reuters, CNN, Russia Today, The Atlantic. Do your own research, I’m not getting paid for this.