Portland in Top 10 Cities Where it is Smarter to Buy Than Rent

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Portland is listed 8th city in the nation where it is smarter to buy than rent in a recent Forbes magazine study. To rank the cities, Forbes computed the premium to buy—the spread between what a consumer would spend to rent and what they would pay for a mortgage—and also identified locales where economists predict home prices will go up the most over the next five years. ”[Portland is] a picturesque, culture-driven city with good local services and amenities,” noted the article.
 
A family hoping to put down roots there would normally pay a 62% premium to go from renting to buying. In the third quarter of 2009, however, that premium shrank by 16 percentage points. At the same time, Moody’s Economy.com anticipates that home prices will jump 19% over the next five years.

January 26, 2010 by beebedou ·

This Week’s Economics Discussion

Filed Under Economy · Tagged: , ,  

There is every reason to believe the recovery is fully entrenched. There are figures to indicate that GDP growth is stronger than expected. However, inflation is a genuine concern due to high deficit spending. This is probably the mushy bottom that we expected to see. Smart investors looking for long-term cash flow or appreciation will be rewarded and timers of the market may be at risk. This is a great time to buy. There is still seller uncertainty but it is exciting to look forward and see great possibilities ahead.

Some Data to Chew On:

· Unemployment claims 4-week average over the past 40 weeks has plunged from 659,000 to 441,000. This is substantial

· Case-Schiller’s House Price Index over the past 8 months appears to have increased at 6.2%

· Retail sales appear to have increased at a 3.5% in Q4 suggesting REAL consumer spending increased at a 2% clip

· Federal tax receipts have increased at a 12.7% rate over past 6 months indicating INCOMES are GROWING

· Corporate profits have surged over the past 3 months as federal tax receipts show massive increases of close to 600%

· US real GDP is on track for 4.5% growth in Q4

 Headwinds:

· Small business hiring remains at recession lows. It is amazing that employment has improved, given this fact

· Credit is still largely unavailable to small business

· Homebuilders show very weak activity as mortgage apps plunged to a 12-year low

 Signs of Inflation:

· Treasury Inflated Protected Securities have turned up significantly. A true sign of inflation

· Economic Cycle Research International has turned up as well. This is an important decision tool

· US core import prices have increased 20.5% in past 6 months

· CPI has swung from -1.9% to +2.8% Y/Y

· India CPI up +20.5% in past 6 months

· Israeli CPI up 4.8% in past 11 months

 The above information was compiled by our Principal Broker, Tom Burk

January 22, 2010 by beebedou ·