If you listen really carefully, you may just heard stirring of an economic comeback, but you will have to hear past some pretty loud static. Here are a couple hopeful signs:
- The Foreclosure Crisis: there is an limit to the number of people who will loose their homes. ARMs that reset today are adjusting downward from a year ago, many loans are adjusting to rates in the 5% range, lower than you can get a new loan. Lenders are negotiating with new vigor with troubled home owners, working on a solution to keep people in their homes. Fannie Mae & Freddie Mac are buying more types of loans, FHA has been widely expanded to help challenged borrowers. Things are improving.
- Oil Prices: Higher oil prices could help Middle America, really. People are buying smaller, smarter cars. Europe has had $4.00+ gas for years. Today, gas in Europe is $8.00 a gallon. With each tick up in gas prices, substitute fuels are becoming more economically viable. Substitutes like ethanol may be better for the environment, and certainly are better for the US economy, because the profits stay with US farmers. So is higher priced gas all bad news? Breaking dependence on foreign fuel sources could be fantastic news for our economy, high prices will force change.
- The Falling US Dollar: I don’t want to suggest that a falling currency is a positive long term trend, but in the short term it is helping US manufacturing dramatically. In helping us be even more competitive in manufacturing we are exporting more today and reducing our trade deficit with each shipment. These exports should strengthen our currency again some day, maybe soon. Right now in America, there is a ’shipping container shortage’. US Exports can’t find enough crates to export in! Shipping containers are being returned to the US empty. This is a very good leading economic indicator.
I realize that none of this on the surface has anything to do with second home news, but just below the surface many families are questioning whether they should buy a second home because ‘they are concerned about the economy’, much of this concern is being caused by politicians and media that are beating the drum of ‘change is needed’. The true economic climate of the US is stable and growing, and far better than most media would lead us to believe, and there are glimmers of even brighter lights on the horizon. Some savvy vacation home buyers are finding now a great time to purchase. shhhh.
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