News: Real Estate, Risk, Economics. Jul. 26-28, 2014

Linking ≠ endorsement. News: Real Estate, Risk, Economics. Jul. 26-28, 2014

Table of Contents
(Click to sections below.)

1) Office Rents In San Francisco Up 81% Since 2010, And Climbing - SocketSite

2) Is this why 3.6 million ready homeowners aren't selling in 2014? | HousingWire

3) Mortgage applications rise, but all on refis

4) 7 signs of a soon-to-be-hot neighborhood | Inman News

5) The US Debt Crisis that Will Never Happen - Daily Reckoning

6) Fire's updated toll: 300 homes, 'horrifying' devastation | Local News | The Seattle Times

7) How is Washington, DC Handling the Big Wave of New Supply? - Apartment Market Dynamics - YouTube

8) The Federal Government Emerges as Lone Star of the Dreary First Quarter - Real Time Economics - WSJ

9) [Very, very highly recommended] Michael Spence warns that political instability and conflict are now the main threat to the global economy. - Project Syndicate

10) Is Involuntary Part-time Employment Different after the Great Recession?

11) World's 85 richest own more than 3.5 billion poorest, UN report says - Business - CBC News

12) Housing labor shortage turning more severe, boosting home prices - LA Times

  1.    Office Rents In San Francisco Up 81% Since 2010, And Climbing - SocketSite™ News: Real Estate, Risk, Economics. Jul. 26-28, 2014

    There is over 4 million square feet of office space under development in San Francisco, the largest pipeline of commercial space in over thirty years. That being said, the majority of that pipeline won't be ready for occupancy until post-2015 and over half has already been speculatively pre-leased....

    Is it really that advantageous to be in San Francisco?

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  2.    Is this why 3.6 million ready homeowners aren't selling in 2014? | HousingWire News: Real Estate, Risk, Economics. Jul. 26-28, 2014

    Trey Garrison:

    ...combination of rising prices and shrinking inventory is one of the reasons the housing recovery is coming to a halt.

    Actually and with all due respect for Trey Garrison's excellent reporting abilities, shrinking inventory is currently the primary reason for rising prices and why interest rates aren't going to rise much if at all. They still may have to go down (once the Fed sees through the "noise").

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  3.    Mortgage applications rise, but all on refis News: Real Estate, Risk, Economics. Jul. 26-28, 2014

    ...this simply proves the disconnect in the market today between the "haves" and the "have-nots."

    "There is the regular market where people need to make money in a job and get a mortgage," said Nela Richardson, chief economist at Redfin, a real estate brokerage. These, she says, are not the ones driving the market.

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  4.    7 signs of a soon-to-be-hot neighborhood | Inman News News: Real Estate, Risk, Economics. Jul. 26-28, 2014

    Tara-Nicholle Nelson:

    Here are the top telltale signs of a soon-to-be hot market.

    They all apply to places to buy to rent out too.

    Add your comment.


  5.    The US Debt Crisis that Will Never Happen - Daily Reckoning News: Real Estate, Risk, Economics. Jul. 26-28, 2014

    Chris Mayer:

    ...the U.S. government doesn't need to borrow what it creates. The U.S. government creates dollars. The U.S. government doesn't need to borrow them to spend them.

    While we don't agree with Gene Epstein, we must say that the US government does borrow to spend. It's true that under the US Constitution, it doesn't have to (and shouldn't); but it still does it.

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  6.    Fire's updated toll: 300 homes, 'horrifying' devastation | Local News | The Seattle Times News: Real Estate, Risk, Economics. Jul. 26-28, 2014

    About 300 homes — twice as many as previously estimated — have burned in the largest recorded wildfire in Washington state history, a county sheriff said Friday.

    Officials had placed the number of homes destroyed at 150 in north-central Washington's Carlton complex fire. But Okanogan County Sheriff Frank Rogers said he knew that figure would rise because crews hadn't been able to reach some of the burned areas.

    The updated estimate came after Rogers and his deputies drove 750 miles of roadway through the blackened area, surveying the devastation.
    ...
    At nearly 400 square miles, or 256,000 acres, the lightning-caused Carlton complex has eclipsed the 1902 Yacolt Burn....

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  7.    How is Washington, DC Handling the Big Wave of New Supply? - Apartment Market Dynamics - YouTube

    Washington, DC has quickly gone from the can't-miss market to one of concern — as the DC metro is taking on an historically high load of new supply. How's the market responding? The latest fundamentals show the story — while it isn't great — isn't as dire as some had feared.

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  8.    The Federal Government Emerges as Lone Star of the Dreary First Quarter - Real Time Economics - WSJ News: Real Estate, Risk, Economics. Jul. 26-28, 2014

    The economy had an unusual bright spot in the dreary first quarter: the federal government.

    After two years of dragging on growth, the federal government's economic output gave an annualized 3.2% lift to the overall economy in the first quarter, the Commerce Department said Friday. A series of spending cuts and last fall's shutdown turned the federal government into a net drag on the economy in recent years, before last quarter's reversal.

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  9.    [Very, very highly recommended] Michael Spence warns that political instability and conflict are now the main threat to the global economy. - Project Syndicate

    Excellent: Michael Spence:

    ...to an increasing extent, political insecurity, potential conflict, and deteriorating international relations pose a greater threat to economic progress than the post-crisis debate foresaw.
    ...
    The global economy is a far more highly interconnected place than it was 40 years ago. The cross-border flows of goods, information, people, and capital that are its lifeblood rely on a threshold level of safety, stability, and predictability. It is this threshold that appears to be under threat. Continued economic progress in the developing world and recovery in the developed countries requires preventing local and regional conflict from delivering large systemic shocks.

    In terms of priorities, it is arguably more important for G-20 governments to strengthen the core systems that enable global flows than it is to address strictly economic issues. Moreover, there is a clear, shared interest in doing so: No one benefits from the expansion of systemic risk.

    Failure to contain the impact of regional conflicts and bilateral frictions may lead to more than just supply shocks in areas like energy. The principal effect is likely to be a series of negative demand shocks: investors withdrawing, travelers staying home, and consumers closing their wallets. In a global economy in which aggregate demand is a key growth constraint, that is the last thing the system needs.

    We have gone about as far as we can with a global system that is at best partly governed and regulated. As the global order defined by the Cold War (and then by a briefly dominant America) recedes into history, a new set of institutions and agreements must be developed to protect the core stability of the system.
    ...
    ...at this moment in history, the main threats to prosperity — those that urgently need world leaders' attention and effective international cooperation — are the huge uncontained negative spillover effects of regional tensions, conflict, and competing claims to spheres of influence. The most powerful impediment to growth and recovery is not this or that economic imbalance; it is a loss of confidence in the systems that made rising global interdependence possible.

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  10.    Is Involuntary Part-time Employment Different after the Great Recession? News: Real Estate, Risk, Economics. Jul. 26-28, 2014

    One of the recent concerns is that while the number of unemployed individuals and the marginally attached individuals has been decreasing since 2009, the number of individuals who are working part time for economic reasons (PTER) has remained elevated (almost 7.5 million workers in April 2014).

    Add your comment.


  11.    World's 85 richest own more than 3.5 billion poorest, UN report says - Business - CBC News News: Real Estate, Risk, Economics. Jul. 26-28, 2014

    This, of course, also applies to top nations, such as the US.

    "If you invest in people, if you upgrade your infrastructure and increase the choices available to all, you will have a more stable society," said Khalid Malik, a lead author of the report.

    Not only will things be more stable, the whole nation will be more prosperous.

    Add your comment.


  12.    Housing labor shortage turning more severe, boosting home prices - LA Times News: Real Estate, Risk, Economics. Jul. 26-28, 2014

    This is inflationary; however, there are downward-economic pressures that are offsetting.

    Builders were specifically asked about 12 trades in the recent survey, and 63% reported a dearth of rough carpenters, who build the supports and temporary forms used on the construction site. But well over half the builders reported shortages in all three "hammer and saw" categories: rough carpentry, framing and finish carpentry.

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