Gary's Blog

Thursday, September 24, 2009

Federal Reserve Optimistic!

The Federal Reserve has signaled confidence in a recovery yesterday, when it decided to stretch out the pace of a program intnded to lower mortgage rates and prop up the housing market. Rather than buying $1.45 trillion in mortgage backed securityies and debt by the end of this year, they pushed that deadline back to the end of March. That's the second time since August that the Fed has opted to slow emergency programs designed to encourage spending and boost the economy.

On a personal note, my wife, Debbie, is an interior designer. She went into Pottery Barn yesterday, and they told her that nationwide, Pottery Barn just had its best month (last month) in the past two years! It looks like consumers are feeling more confident as well.

At Coldwell Banker Island Properties, as of the 15th of this month, our company has put 27 properties in escrow. That's about two new escrows per day, the same pace we had in August. September is typically a very slow month here, but it doesn't seem to have slowed down.

Also, another agent just told me yesterday she has a $10 million cash beachfront buyer coming into town, and when she searched for properties to show him, six beachfront properties that she had hoped to show were either in escrow or closed escrow.

On the low-end, Kihei Villages is showing some real strength. There are only 14 Active listings in the complex of 532 units. Typically, if less than 5% of a project is available for sale, that indicates strength in values. There are six units in escrow in the complex right now, and in the past six months, 13 unit sales have closed in the complex. That means we have less than six months' inventory, another strong indicator for future values.

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