National Economic Outlook (September 2013)

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The rate of annual job growth in August, 1.7 percent, was basically the same as in previous months. We had better get used to the idea that this is the new normal, because there probably won't be much help from the lagging government and construction sectors.

Budget difficulties will prevent any meaningful increase in government spending, even though local and state revenues are now in better shape. The recession revealed the extent of unfunded pension liabilities for public employees, which will absorb any extra dollars.

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National Economic Outlook (August 2013)

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The pace of job growth in July was unchanged from the 1.7 percent annual rate of previous months, but the details suggest an economy that will do modestly better for the rest of the year. Most importantly, jobs in business services were up 3.5 percent from last year.

Business services is one of the largest sectors of the economy, on a par with health care and government, and bigger than retail or manufacturing. Earlier this year it was growing at a 3 percent rate, in the last few months around 3.5 percent; it seems only a small increase but it means that businesses are expanding again.

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National Economic Outlook (June 2013)

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The economic recession only lasted a year, but there wasn't a recovery for homes because prices had climbed much too high and builders had built way too many of them. Prices had to fall, not just back to a “normal” level, but to an even lower level so that the large inventory of excess homes could be moved – a sort of clearance sale. We're not yet done with that sale – see the large number of mortgages still delinquent – but enough has been cleared out so that prices can drift up to a more normal level.

 

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United States Real Estate on Sale?

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Demand for U.S. real estate by foreign investors has exploded over the last year.  The first reason has been the weakness of the U.S. dollar.  That has allowed foreign buyers to invest in U.S. real estate that produces favorably high yields, as well as profiting from the currency trade. These two factors compound to give foreign investors greater returns.

Since 2006 property values in America had declined in many markets by as much as 70%.  Now with the ongoing manipulation tactics of the Federal Reserve Bank, Ben Bernanke’s QE to infinity, and suppressed real estate inventory by the major banks, real estate prices have been rebounding in most U.S. real estate markets.  That explains some of the reasons foreign investors are taking their capital and placing it in U.S. investment properties.

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Zombie Foreclosures

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Hundreds of thousands of homes in the US are now labeled as “zombie” foreclosures. That's when the owner of a foreclosed home leaves only to find out years later that he or she still legally owns the home and is on the hook for property taxes and other fees. Such cases occur in more than a third of foreclosures, industry figures show.

Although it's hard to quantify exactly how many homes fall into the category, real estate information company RealtyTrac says that, in the first three months of the year, roughly 302,000 homes qualified as “zombie” properties because the owner has moved out, but the bank has not yet taken possession.

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