The Supply and Demand of Housing

first_imgThe Supply and Demand of Housing Forecast Freddie Mac Home Prices Home Sales Housing Starts Mortgage Rates 2014-05-20 Tory Barringer As housing metrics continue to take unexpected turns, it’s become clear by now that the current recovery has functioned unlike any other. In the company’s latest Economic & Housing Market Outlook, economists Frank Nothaft and Leonard Kiefer at Freddie Mac took a look at three fundamental areas—mortgage rates, home sales, and household formations—to figure out why.Dissecting each category, the economists come to the conclusion that the reason why housing has moved in the direction it’s taken is due to one of the most basic economic rules: supply and demand.Starting with mortgage rates, the researchers note that despite climbing compared to last year, rates in the last few months have remained fairly steady, an unexpected reaction to the Federal Reserve’s movements to gradually end its monthly asset purchase plan. In fact, as of mid-May, Freddie Mac’s Primary Mortgage Market Survey had 30-year average fixed rates at a six-month low.However, since recent cuts to the Fed’s purchases of mortgage-backed securities (MBS) have coincided with a dramatic decline in mortgage originations—and thus MBS issuance—the effect has been minor so far.”[E]ven though the Fed’s purchases of MBS (the monthly ‘net addition’ plus the replacement of principal pay downs on existing holdings) are down significantly, so are monthly MBS issuances,” the researchers said in their latest report. “In fact, the Fed’s acquisitions, as a ratio to new issuance, are slightly higher than a year ago.”In other words,” they went on, “the Fed’s ‘demand’ for new MBS has declined less than has new ‘supply’, thus keeping the Fed’s share of MBS issuance above year-ago levels.”With refinance demand down so significantly over the past year, originations and issuance are expected to remain low, meaning the Fed’s scaledown in purchases won’t meaningfully push rates up until asset purchases near zero.On the topic of the relationship between home sales and prices—namely, prices continuing to rise despite weak sales data—Nothaft and Kiefer argue that nothing out of the ordinary is happening: Though sales are down, demand for housing has stayed strong, as evidenced by the estimated 5.2 months’ supply of homes on the market as of March. And with few additional homes trickling into the available stock, the combination of high demand and low supply has lifted prices throughout the recovery.Also key to the rise in prices is a decline in distressed sales and low-priced stock, bringing the median up.Finally turning to the actual supply of homes, the two economists observed that though housing starts have risen from their 2009 trough, they have struggled to get back to normal historical levels, in large part because of the lackluster rate of household formations, which have barely crossed the 500,000 mark annually since the Great Recession.Though birth rates through the late 80’s and early 90’s are favorable for new household growth at this time, the other main factor affecting household formations—the business cycle—is still weak after the crisis.”[M]any adults in their 20s have continued to live with relatives (often parents) and have had to wait an extended period to save funds and generate an earnings cash-flow sufficient to set up their own household,” the economists wrote. “We understand that we might sound like a broken record here, along with many other economists, but the need to have a job before buying a house is a simple fact of life.”With economic growth expected to accelerate to an annualized rate of 3.0 percent in the coming quarters, payroll gains should improve to a steady 200,000–250,000 per month, contributing to new formations and new starts.”If we get that, we’ll be able to address the underlying ‘supply’ problem because we know the ‘demand’ for housing is there,” Nothaft and Kiefer concluded. Sharecenter_img in Daily Dose, Data, Headlines, News May 20, 2014 548 Views last_img read more

first_imgShinta Mani Hotels will launch its first flagship Bensley Collection property in mid-December 2017. The boutique resort will comprise 10 ultra-luxe two-level expansive villas in the cultural heart of the historic town of Siem Reap, Cambodia.In collaboration with designer and architect Bill Bensley, Shinta Mani Hotels ‘Bensley Collection’, will be an portfolio of super-luxe hotels and resorts showcasing visionary concepts, extraordinary design and bespoke service.In creating his collection, Bensley has assumed complete freedom to let his creative spirit run free and showcase his skill in crafting luxury experiences with his personal brilliance. He has designed the villas as he likes to live; surrounded by lush gardens which are completely private. Knowing the importance of sleep, Bill has designed the most comfortable beds imaginable, with Khmer inspired sheets and a plethora of feather or ‘as you like’ pillows. Bill has overseen every detail of design and service to ensure a type of indulgence he calls ‘escapism’ (also the title of his book) and one that guests will long remember.On arrival at Siem Reap’s International airport, guests will be fast-tracked through immigration and whisked away to the secluded entrance of the villas where an arrival ceremony experience awaits.Under the ancient canopy of Siem Reap’s Palace trees, each villa will offer its residents total privacy, complete with their own Bill Bensley tropical garden that brings the outside in.Each Art Deco-inspired villa will offer 156sqm of space across two pavilions, including a floor-to-ceiling glass bathroom with views over the garden and the outdoor bath.Inside the living space, 3D  murals have been carved to portray the rippling folds of Jayavarman’s robe, one of the Khmer Kings who reigned from 1181-1218, known for his powerful, pioneering spirit.Six of the villas are able to be combined into three 312sqm two-bedroom villas (each with its own pool) to accommodate a family or friends travelling together.Guests will have full use of the restaurants, bars, Shinta Mani Spa by Khmer Tonics and facilities in the adjacent Shinta Mani Hotels, or can have personal service from any outlets in their villa.Bensley Butlers are on hand when they are needed and invisible when they are not. If guests want petals scattered for a romantic outdoor bath, a rooftop or poolside barbecue, or to set up the sky bed so they can sleep under the stars in the oversize rooftop daybed, just call them. This small but highly trained band of butlers, under the helm of Head Butler Mac, are traditionally trained, resourceful and will look after all the guests’ needs.A proportion of the daily room rate will be donated to the non-profit Shinta Mani Foundation, created by the owner, to support health, education and development programmes for the less fortunate in the community.There are two ways to enjoy the villas: on a bed and breakfast basis or – as Bensley likes to travel – full on, immersed in the culture and nature with no limits:Bensley Bed and BreakfastFast-track immigration on arrival at Siem Reap International AirportPrivate roundtrip airport transfersPersonal Bensley ButlerExpress check-in and express in-villa checkoutUnpacking on arrival and packing before departureWelcome champagne on arrivalWelcome amenitiesWelcome 30-minute head and shoulder massage in villaSumptuous daily breakfast for two adultsDaily high tea with canapésDaily seasonal fruitLaundry serviceRemork (local tuk tuk) transportation within Siem Reap 24 hoursBensley All-Inclusive ExperienceFast track immigration on arrival and departure at Siem Reap International AirportPrivate round trip airport transfersPersonal Bensley ButlerExpress check-in and express in-villa check-outUnpacking on arrival and packing before departureWelcome champagne on arrivalWelcome amenitiesWelcome 30-minute head and shoulder massage in villaFree use of smart phone with local SIM card during stayDaily breakfast for two adultsDaily high tea with canapés for two adultsDaily seasonal fruitLaundry serviceRemork (local tuk tuk) transportation within Siem Reap 24 hoursLunch and dinner daily for two adultsFree-flow mini-bar of wine, beer and soft drinksDaily sunset cocktails on private rooftop living room in villa with barefoot butlerSightseeing tour with private car, driver and tour guide to Angkor Wat and other major temples, including sunrise tour with champagne breakfast or sunset at Pra Rup Templelast_img read more