Housing Giants - December 10, 2008 - (Page 15) Single-Family Permits as % of Peak, 1980-2007 behaved very similarly, with the exception of the five markets (San Jose, Denver, Raleigh, Seattle and Austin) that got hit especially hard by the NASDAQ collapse. We divided the 183 largest markets across the nation into a graph for two camps — those that troughed in the mid-80s and of single-family permits as percentage of in the mid-80s those that peakedpeak, 1980-2007 — and you can see that construction trends behaved very similarly. have certain submarkets that stabilize first. To prepare for the recovery, we have divided the 30 largest markets in the country up into more than 300 submarkets, and we are collecting the information needed to help our clients invest in the right submarkets. put on your consumer Hat What are the right markets? To answer that question, you need to put your consumer hat on. Here are some suggestions to guide your analysis of submarkets. Do the following in all your metro areas: 1 Best Submarkets: For every significant household composition, psychographic profile and price range, imagine that you were advising a friend who had been transferred to your market about where to buy a home (not necessarily a new home). Where would you recommend that they buy? You will probably choose areas near the job centers and in the best school districts where undeveloped land is tough to find. 2 Emerging Submarkets: Ask yourself which submarkets are going to change for the better. Areas where for a graph of total single-family permits (1996 through 2012P) Diversity will Help going ForwarD Our Custom Consulting team has conducted field research on almost 1,000 communities this year, and we strongly believe that this turnaround is going to vary geographically. The best areas are where job growth continues (or returns first); where affordability is at or below its historic norm, which is rapidly occurring in almost every market; and where the oversupply of resale and new homes subsides. Washington, D.C., and San Diego are two markets that we believe will be among the first to stabilize. Every metro area in the country will www.Housinggiants.com 12.10.08.Housing giants 15 http://www.housinggiants.com
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