Falling oil prices should be good for real estate markets

This Economist article Why the oil price is falling explains the background to falling oil prices which should, in general, be good for the US economy next year and by extension good for the real estate market which, having largely recovered from the Great Recession, is now more dependent upon economic growth for continued gains.

The table below shows forecasts from IHS Global Insight for the US economy in 2015 at different average oil prices:

Source: IHS Global Insight, The Wall Street Journal

Source: IHS Global Insight, The Wall Street Journal

The US, however, has tremendously increased its oil production in recent years. That means, of course, that some States will suffer from a lower oil price, as explained in this ABC News Falling oil prices raise concerns for States report.

Any economic or real estate forecast always bears the caveat “barring unforeseen geopolitical developments.” I was tempted to head this post:What will Russia do? If I had to cite my biggest concern for 2015 it would be how Putin will react to the continuing pressure that the low oil price, coupled with sanctions, is putting on the Russian economy and exchange rate, not to mention the fortunes of the oligarchs. It would be foolish to rule out further what Bloomberg describes as “regional geopolitical adventures.”

And that would not be good.

 If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, feel free to contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com.

Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty

Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty
Affiliates LLC. Each Office Is Independently Owned and Operated

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Housing market in “early stages of recovery”

Two public house-building companies released strongly optimistic comments about the future of the housing market this week.

Robert I. Toll, executive chairman of Toll Brothers, stated: “We believe the housing recovery has many years to run. Housing starts, through ups and downs from 1970-2007, have averaged about 1.6 million annually. According to Harvard University’s Joint Center for Housing Studies, ‘Despite the rebound in the last two years, home sales and starts are still nowhere near normal levels. This was the sixth consecutive year that starts failed to hit the one million mark, [which was] unprecedented before 2008 in records dating back to 1959.’

“Meanwhile, the country has continued to grow. In 2005, the peak of the last housing cycle, U.S. population stood at 295 million. That number reached 316 million in 2013, an increase of 21 million people. Even with the well-publicized recession-driven lag in household formations (compared to population growth), there were still 4.6 million more households in 2013 than in 2005

Ara Hovnanian, Chairman, President and CEO of Hovnanian Entreprises commented: “We continue to believe the housing industry remains in the early stages of a recovery. Improving demographic and employment trends should result in a more robust housing market that returns both national housing starts and sales pace per community to normalized levels.”

If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, feel free to contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com.

Andrew Oliver is a Realtor with Harborside Sotheby’s International RealtySotheby’s International Realty® is a registered trademark licensed to Sotheby’s International RealtyAffiliates LLC. Each Office Is Independently Owned and Operated

You can REGISTER to receive email alerts of new posts on the right hand side of the home page at www.OliverReports.com.

@OliverReports

 

What Jon Lester can afford to buy in Chicago

While Jon Lester’s sale of his Newton home Why Jon Lester may not be returning to the Rex Sox did not necessarily indicate that he would not be coming back to the Red Sox, he is in fact going to Chicago. For $155 million for 6 years.

Which raises the question, obviously, of where he will live.

Here are a few options from Chicago’s most expensive listings if Mr.Lester decides to live in Chicago itself.

And he would have enough left over to buy a Greek island Check carefully before you buy that Greek Island for the off-season.

If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, feel free to contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com.
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty
Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty
Affiliates LLC. Each Office Is Independently Owned and Operated

You can REGISTER to receive email alerts of new posts on the right hand side of the home page at www.OliverReports.com.
@OliverReports

Check carefully before you buy that Greek Island

While, in the words of the Wall Street Journal, buying a Greek Island “drenched in sunshine and surrounded by turquoise water”may be the ultimate property dream, there are a few pitfalls of which buyers need to be aware.

For the brave – not to mention very rich – there are about 20 islands currently for sale, ranging from $100 million plus to just a few millions.

But caveat emptor.

Some of the pitfalls include:
– access to many of the islands is difficult — especially since Greece has restrictions on private seaplanes. Personally I would not even consider an island to which I could not fly in my own seaplane.
– up to 32 bureaucratic steps are required, including background checks to determine whether a prospective buyer would pose a threat to the country’s national security. Obviously, this is why recent buyers come from stable countries such as Russia.
– if you think it’s difficult to get a plumber here, consider how you’d get one out to your island. You can’t even send your seaplane.
– all beaches are public. That means no matter how remote the island or how high the price tag, anyone with a yacht can show up, uninvited. Bummer. Compare that with Massachusetts where owners of waterfront property own to the low water mark.Now if we could just turn the ocean blue and get the temperature up about 30 degrees…..
– Greece has also introduced an annual property tax, something which is believed to be causing the flood of islands for sale.

Many homeowners in the US were – and some still are – trapped in houses with no ability to sell. But I suspect few in any US cities could compare with Athens, where the number of sales dropped from 250,000 in 2005 to just 3,600 in 2013.

When I started reading how to buy a Greek Island, I must admit I was tempted, but on reflection maybe a wiser investment would be a vacation.

If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, feel free to contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com.
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty

Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty
Affiliates LLC. Each Office Is Independently Owned and Operated

You can REGISTER to receive email alerts of new posts on the right hand side of the home page at www.OliverReports.com.
@OliverReports

Carnegie Hall comes to Marblehead

As part of this weekend’s Christmas Walk, the Old North Festival Chorus performs two concerts at Old North Church, 35 Washington Street, on Saturday at 8:00 pm and Sunday at 7:30 pm.

The Concerts, in their 34th year, feature a wide range of music, from Bach’s Magnificat to carols, in which the audience is invited to join in, with appearances from the Old North Bell Choir and the award-winning Old North Children’s Festival Chorus. Truly something for everybody and a joyous and memorable evening is guaranteed.

Tickets can be bought in advance at Crosby’s Marketplace, Arnould Gallery and Spirit of ’76 Bookstore, for Sunday at Buy Tickets here or at the door.

Here is a letter Carnegie Hall comes to town from the Marblehead Reporter. (more…)