Arizona And West Poised To Beat National Job Numbers

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Millionaire Now! by Larry Nusbaum

This blog is based on the organizational principles found in my new book, "Millionaire Now! - A Financial Toolbox with Seven Steps to Wealth".

Arizona And West Poised To Beat National Job Numbers

Posted on 06/07/2007 07:50:25 | Link | Post Comment

Arizona and West poised to beat national job numbers
from the Business Journal of Phoenix, reports that while the national economy is expected to remain sluggish through the rest of the year with a projected 1.3 percent employment gain, projections for the West, including Arizona, are much stronger. Arizona is expected to see a 3.5 percent gain in wage and salary employment for the year, behind only Nevada which is expected to gain 4.3 percent. The information came from the latest Western Blue Chip Economic Forecast put out by the W.P. Carey School of Business at ASU. The Blue Chip Forecast also looks at 2008 with Arizona jobs expected to grow 3.4 percent. As long as we keep gaining population and jobs, our market will be fine.

Many investors feel like running away from homes, from USA TODAY, reports that many real estate investors are switching back to stocks in a complete flip-flop of what occurred in 2002, when investors tired of the bear stock market and began investing in real estate. People doing that were the subject of a USA TODAY cover story in December 2002. Dave Yeske, a San Francisco financial advisor, was featured in that 2002 story because he was being barraged with people selling stocks to buy homes. "The pendulum has swung in the opposite direction," he says now. "The clients that sold stocks to buy spec homes in Arizona are telling me they're under water, can't rent them and wish they had left all the money in the stock market." Many investors are now landlords, getting calls from tenants to fix leaky toilets in properties that are not worth as much as the investor paid for them. The plight of the real estate investor is even the topic of a web mockumentary, called Flipper Nation, that pokes fun at two wannabee real estate speculators who ended up making a $1 profit.

Housing's Recession 'not yet out of the woods':Noteworthy comments from Bob Doll, global chief investment officer of equities at Wall Street investment house BlackRock - full text HERE

"In our view, we are not yet out of the woods in terms of the ongoing housing recession, which is still acting as the primary drag on economic growth. Consumer credit levels have been deteriorating and both commercial and residential delinquency rates have been moving up, which suggests to us that housing market weakness still may have some ways to go. Having said that, we would point to several factors that are countering the recessionary impact of the slowing housing market. In particular, the silver lining in last week’s GDP report was an upward revision in the level of domestic demand among consumers, suggesting that despite the slowdown, resilient consumers are still willing to spend. Additionally, exports continue to boom, business investment levels have shown signs of improvement and data suggests that the weakness in first-quarter inventory levels may have turned a corner. Despite the weak GDP growth figure, recent statements from Federal Reserve officials continue to paint a relatively hawkish view regarding monetary policy. The central bank remains concerned about the tight labor market and about the weak U.S. dollar, both of which are putting upward pressure on inflation. While we continue to believe that the Fed’s next move will be to lower interest rates, it does appear less and less likely that that move will come any time soon."

How is the housing market doing?
According to Brad Inman, the current state of the housing market tells the story of the country's economic divide in a dramatic way. A summer home in the Hamptons sells for $100 million. An apartment in New York City sells for $50 million. The median home price in pricey Marin County near San Francisco reached $1 million. High-end San Francisco, Marin and the Silicon Valley showed home price gains in April. That is one end of the economic divide. The other end tells a different story. Working class areas of New York, like Long Island, and outlying suburbs of San Francisco are experiencing price drops. The same is true in downtown San Diego, Riverside County, west of Los Angeles, and many parts of Florida. The extreme case of housing depression is Detroit. Read more HERE

Using Real Estate to Build Your Retirement Portfolio
from the WSJ, reports that one way to diversify your savings is to use your IRA to invest in investment properties. But be sure to heed the complex rules.

Housing Bubble and Real Estate Market Tracker from SA for 6/6

Estate planning: The sad realization: The 2001 Tax Act gradually reduces estate taxes until they disappear entirely in the year 2010. After that, who knows? The hope among rich people was that the Republicans would be in power and would permanently erase federal Estate taxes. Hence many rich people have been postponing doing anything about their estate planning. The dawning realization is that Republicans won't be in charge. And the Democrats are not motivated to erase the death tax. So we're back to square one: boring planning. Yuch!

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