Location Strategy Chartbook 062124

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Location Strategy news! Our partner Julie Chang will now be taking an expanded operations role with Location Strategy, especially with regards to billing and accounting issues. If you’d like Julie’s help on an issue, please reach out to her at [email protected].

LOCATION STRATEGY CHARTBOOK

The Federal Government this week announced restrictions on the import of Mexican avocados and mangoes after US inspectors in Mexico were threatened this week. No word on whether Washington intends to release stock from the Strategic Avocado Reserve to stabilize prices on avocado toast and carnitas tacos, important to several strategic electoral demographics.

For a quick update on our reasons why the Fed will have to cut rates: Federal interest payments now exceed the defense budget. That’s before refinancing $14 trillion in debt in the current rate environment. The Federal Government could spend $1.2 trillion on debt service this year.

Banks are looking at $617 billion in unrealized losses on investment securities - this is a direct result of rate increases. It’s kind of like the S&L Crisis in the 1990s where profitable investments went underwater as rates rose.

Another negative economic sign is that real income expectations hit the lowest levels in over a decade.

The Fed follows the job market closely because the labor market will ultimately determine the path of Fed easing.

We would likely not see any job growth without immigration; it is a disinflationary factor in the job market.

The share of household spending on goods remains elevated.

Homebuilder sentiment falls on weaker traffic and sales. This is largely a story outside growth markets.

Metropolitan areas that have experienced an influx in population growth since mid-2022 have responded with an increase in housing supply,

The total mortgage activity has been down sharply from the 2021 levels, but first-time buyer share has been rising.

Completed US apartment conversions by source:

DFW has experienced 4,500 hail storms since 1990.