In an effort to continue to provide you with relevant information on the Little Rock market and the apartment industry in general, below please find a link to a few articles that I thought you would find interesting.
November Articles of Interest
The Central South continues to be a relative bright spot compared to the National economy as you can see from some of the articles I have provided. And, while we are not completely sheltered, Little Rock was recently named as one of “America’s Fastest-Recovering Cities” by Forbes and also named 6th on MSN.com’s list of “Most-Livable Bargain Markets.” Compared to what I am reading nationally, that’s good news in a rough economy.
Categories: Apartments · Business · Housing · Multifamily · Real Estate · Real Estate Investing
Last week BusinessWeek published an article titled: ”The U.S. Metros Least
Touched by Recession”, and of no surprise to those of us
in the Central South, Little Rock was listed among the Top 5. In fact, much
of the Central South was included in the report – Oklahoma City, Oklahoma
ranked third while and Tulsa, Oklahoma came in at #7.
This is not to say that conditions are entirely perfect, and as you will see
in our Second Quarter Economic & Demographic Profile for the Little Rock
metro, we certainly have had our struggles. However,
compared to other parts of the country, there are plenty of positives that
we can look to. As a recent article from ArkansasBusiness points out, “.
Arkansas continues to have less of a tough time than most states,” a
sentiment that is also echoed by the BusinessWeek write-up. Case in point,
ArkansasBusiness also reported on employment numbers for the state as of the
month of August. The seasonally-adjusted unemployment rate as for Arkansas
was 7.1% overall, which is significantly below the 9.7% national tally. The
Fayetteville metro region continues to boast the most positive unemployment
rates statewide at only 5.5%, with metro Little Rock (including Conway)
coming in at 6.0%.
University of Arkansas at Little Rock economist Michael Pakko recently spoke
at the Economic Forecast Conference sponsored by the UALR Institute for
Economic Advancement, during which he attributed Arkansas’
recession-resistant status to “the state’s ability to avoid economic peaks
and valleys; the fact that problems in the national economy were not
“homegrown;” and continued growth in industries that are increasingly
important to the Arkansas economy.”
As always, I have pulled together a few articles that I thought you would
find interesting, which you can access here. Please feel free to forward these on
to other colleagues that would benefit as well.
Categories: Real Estate
Tagged: Apartments, Arkansas, Business, Hendricks & Partners, Little Rock, Little Rock Apartment Market, Little Rock Economy, Multifamily, UALR
September 2, 2009 · 1 Comment
Thankfully the Northwest Arkansas Business Journal is a much better note taker than I am and they captured the highlights of Lee Scott’s speech last week at the Annual 40 Under 40 event.
Here are the high points from Scott’s speech:
1. Hiring people better than yourself is an effective way to build a career.
2. Ego is the biggest enemy of leadership.
3. When people know what you want, they will often give it to you.
4. The ability to give honest constructive feedback is essential.
5. Very few people ever feel like they are on top of things.
6. What you say and how you say it is not nearly as important as what is heard and how it is heard.
7. Even if you feel very strongly about something, there is a possibility you could be wrong.
8. Your harshest critics may be the most helpful voices you hear.
9. Sharing praise is a compromise; give it all away.
10. Integrity is the single most important characteristic.
Categories: Business
Tagged: 40 Under 40, Lee Scott, Northwest Arkansas Business Journal, Wal-Mart
If you missed Thomas J. Sugrue’s WSJ article, The New American Dream: Renting, and you are in the housing business, it is worth taking the time to read. Mr. Sugrue is not in the housing business or business in general, rather he is a Professor of History and Sociology at the University of Pennsylvania. However, his insight into the current housing epidemic, likely in large part to the fact that he is currently writing a book on history of real estate in modern America, brings to question U.S. housing policies and the apparent slant in favor of single-family home ownership (To be clear, I am in favor of homeownership, but not via outrageous and fiscally irresponsible government stimulus. For more on this topic read: Top 9 Benefits of Rental Housing and 8 Reasons We Need Renters).
Rental housing has definitely had a struggle in the United States, but after reading Professor Sugrue’s article, historically there is a reason that the cards are stacked in favor of homeownership. Here are several quotes that I found interesting:
- From 1900, when the census first started gathering data on home ownership, through 1940, fewer than half of all Americans owned their own homes. Home ownership rates actually fell in three of the first four decades of the 20th century. But from that point on forward (with the exception of the 1980s, when interest rates were staggeringly high), the percentage of Americans living in owner-occupied homes marched steadily upward. Today more than two-thirds of Americans own their own homes.
- Yet the story of how the dream became a reality is not one of independence, self-sufficiency, and entrepreneurial pluck. It’s not the story of the inexorable march of the free market. It’s a different kind of American story, of government, financial regulation, and taxation.
- Until the early 20th century, holding a mortgage came with a stigma. You were a debtor, and chronic indebtedness was a problem to be avoided like too much drinking or gambling. The four words “keep out of debt” or “pay as you go” appeared in countless advice books. …Because of that, many middle-class Americans—even those with a taste for single-family houses—rented. Home Sweet Home didn’t lose its sweetness because someone else held the title.
- By 1950, 55% of Americans had a place they could call their own. By 1970, the figure had risen to 63%. It was now cheaper to buy than to rent. Federal intervention also unleashed vast amounts of capital that turned home construction and real estate into critical economic sectors.
- It’s a story riddled with irony—for at the same time that Uncle Sam brought the dream of home ownership to reality—he kept his role mostly hidden, except to the army banking, real-estate and construction lobbyists who rose to protect their industries’ newfound gains Tens of millions of Americans owned their own homes because of government programs, but they had no reason to doubt that their home ownership was a result of their own virtue and hard work, their own grit and determination—not because they were the beneficiaries of one of the grandest government programs ever.
- Federal housing policies changed the whole landscape of America, creating the sprawlscapes that we now call home, and in the process, gutting inner cities, whose residents, until the civil rights legislation of 1968, were largely excluded from federally backed mortgage programs. Of new housing today, 80% is built in suburbs—the direct legacy of federal policies that favored outlying areas rather than the rehabilitation of city centers.
- During the wild late 1990s and the first years of the new century, the dream of home ownership turned hallucinogenic. The home financing industry—at the impetus of the Clinton and Bush administrations—engaged in the biggest promotion of home ownership in decades. Both pushed for public-private partnerships, with HUD and the government-supported financiers like Fannie Mae serving as the mostly silent partners in a rapidly metastasizing mortgage market. New tools, including the securitization of mortgages and subprime lending, made it possible for more Americans than ever to live the dream or to gamble that someone else would pay them more to make their own dream come true. Anyone could be an investor, anyone could get rich. The notion of home-as-haven, already weak, grew even more and more removed from the notion of home-as-jackpot.
To read the full article click here.
Categories: Real Estate
Tagged: The New American Dream, Thomas J. Sugrue, University of Pennsylvania, Wall Street Journal, WSJ
It’s rare for Warren Buffett to write for publication (outside of his Annual Letter to Shareholders), so when he does I take notice. This week Mr. Buffett wrote an article in the New York Times that I think is not only worth reading, but is also worth passing along to your Congressmen as well.
Here are a few quotes I found interesting:
- Because of this gigantic deficit, our country’s “net debt” (that is, the amount held publicly) is mushrooming. During this fiscal year, it will increase more than one percentage point per month, climbing to about 56 percent of G.D.P. from 41 percent.
- An increase in federal debt can be financed in three ways: borrowing from foreigners, borrowing from our own citizens or, through a roundabout process, printing money.
- The current account deficit — dollars that we force-feed to the rest of the world and that must then be invested — will be $400 billion or so this year.
- …borrowing from our own citizens. Assume that Americans save $500 billion, far above what they’ve saved recently but perhaps consistent with the changing national mood.
- …the Treasury will be obliged to find another $900 billion to finance the remainder of the $1.8 trillion of debt it is issuing. Washington’s printing presses will need to work overtime.
- With government expenditures now running 185 percent of receipts, truly major changes in both taxes and outlays will be required. A revived economy can’t come close to bridging that sort of gap.
- Legislators will correctly perceive that either raising taxes or cutting expenditures will threaten their re-election. To avoid this fate, they can opt for high rates of inflation, which never require a recorded vote and cannot be attributed to a specific action that any elected official takes.
- John Maynard Keynes…: “By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens…. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”
- But it was a wise man who said, “All I want to know is where I’m going to die so I’ll never go there.” We don’t want our country to evolve into the banana-republic economy described by Keynes.
- Once recovery is gained, however, Congress must end the rise in the debt-to-G.D.P. ratio and keep our growth in obligations in line with our growth in resources.
- The dollar’s destiny lies with Congress.
You can read the full article here.
And, if you’d like to make sure your Congressmen read Mr. Buffett’s article too, you can contact them here. (Feel free to post this abbreviated link in your email to them: http://su.pr/1UHr6p)
Categories: Business
Tagged: New York Times, The Greenback Effect, Warren Buffett
Arkansas Business provided a summary in this week’s issue from a University of Arkansas panel of finance and economics professors. Specific to the Arkansas economy, Professor Tim Yeager, associate professor of finance and chair of Arkansas Bankers Association, stated, “I think we began the correction earlier than the U.S. economy did.”
Regarding the national economy, Raja Kali, associate professor of economics, said “the economy may be going through a structural shift from ‘consumption’ driven to ’savings’ driven. It’s a shift that may be good in the long run, but could be a very painful process.”
Read the full Arkansas Business article here.
Categories: Real Estate
Tagged: Arkansas Bankers Association, Arkansas economy, Arkasnas Business, Raja Kali, Tim Yeager, University of Arkansas
