BRIEFINGS ARE BACK. NOVEMBER 15, 2023

Location Strategy is proud to announce its first forecast briefing presentation on November 15, 2023, from 7:30–10:00 AM. Click here for full details and to reserve your seat.

We have a panel of distinguished builders, developers, and lenders covering affordability across the pricing spectrum and the outlook for project and home lending in 2024. Panelists include:

• Jennifer Keller, Hamilton Thomas Homes

• Becky Ullman, Lennar/Friendswood Development

• Matthew Brodd, AmCap Home Loans

• Lawrence Dean, Veritex Community Bank, moderator

The Panel will be followed by the 2024 economic forecast to be given by Scott Davis.

Don’t delay; limited seating is available. Click here to reserve your seat.

Location Strategy Chartbook

As expected, the FOMC left rates unchanged but signaled another rate increase this year.

Jerome Powell tells us this week a soft landing is not the “base case” and maybe we should expect rates to stay higher for longer. I am not a subscriber of this view, because the cost of servicing US debt is about to explode:

In fact, Powell may not realize the call is coming from inside the house: the Atlanta Fed estimates that GDP this quarter is 4.9%, but the St. Louis Fed estimates that the US economy is currently in a recession.

St Louis Fed is probably right - hiking cycles usually do cause recessions, but not always.

Recent employment growth has primarily been in lower-paying, high-touch services. Such a trend could dampen consumer spending - aso suggestive of a potential recession.

There’s a large divergence between starts and permits is unusual.and alarming. The seasonnally adjusted trends are shown below.

A similar divergence is occuring betwen permits and the MBA purchase index.

One-third of homes are selling above asking price

Investors are increasing their share of purchases in key metro markets.

Nearly 80% of respondents to a recent Redfin survey support policies that promote homebuilding. But just one-third of them would feel positive about a large new apartment complex built near their home.

Where in the cycle are apartment markets: