To a large degree, normalcy has returned to the credit markets. The TED spread is ongoing proof of that.
TED-Spread On Wednesday, this widely quoted credit risk indicator fell to a 26-month low. The TED spread is now below its August 2007 levels. (August 2007 is generally viewed as the beginning of the subprime crisis.)
The TED spread is simply the difference between what banks and the U.S. Treasury pay to borrow money for three months. People use it to gauge fear and liquidity constraints in the North American credit market.
The TED spread reached an all-time high of 4.65% at the height of the credit crisis in October 2008. Its long-term average is about 1/2%.
If you live in an area that experienced high growth in 2005 and 2006 odds are you have a zombie subdivision in your community. You know what I am talking about, roads, lights, maybe even sidewalks installed around fields of weeds and brush. Perhaps there are a couple of homes built, maybe even a face that looks out from the home nervously when the rare car drives by.
The Zombie Subdivision. The living dead of real estate.
The Wilmington Star out of North Carolina had an interesting article on the phenomenon. Wilmington
and the surrounding area had a huge boom as people were leaving the northeast and moving to the ocean. Property values soared. Development was rampant. In Brunswick county, between Wilmington and Myrtle Beach, huge golf communities were planned and permitted. In 2005 and 2006. Ready to open just when the bottom fell out of the market.
These empty tracts, the shell is ready but there is no life, are the prime examples of zombie subdivisions.
It’s clear now to developers, bankers and real estate agencies that the planned development in Brunswick didn’t fit the market.
“What we saw from an appraisal and real estate point of view was that we really peaked about the third quarter of 2005,” said Tom Shoaf, a broker with Coldwell Banker Sea Coast Realty. “But by then, the permits had been pulled for a lot these projects and stuff was getting in the ground, so they were past the point of no return.”
In the end, these developments will probably get moving again – though maybe not for the next couple of years, officials say.
“I foresee a slow, steady growth,” Brunswick County Assistant Attorney Jana Berg said.
But the homes will likely be cheaper, smaller and come with fewer perks.
Welcome to the HomeZilla Real Estate Trends. As in previous months, we list the most searched provinces, top 10 most searched cities and top 10 most searched amenities.
HomeZilla’s Most Searched Provinces
1
Ontario
2
British Columbia
3
(+1)
Nova Scotia
4
(-1)
Alberta
5
Manitoba
6
(+1)
New Brunswick
7
(-1)
Quebec
8
(+2)
Newfoundland
9
(-1)
Saskatchewan
10
(-1)
Prince Edward Island
HomeZilla’s Most Searched Cities
1
Toronto
2
(+1)
Ottawa
3
(+1)
Mississauga
4
(-2)
Vancouver
5
(-)
Quesnel
6
(-)
Oshawa
7
(-2)
Calgary
8
Brampton
9
(-)
Winnipeg
10
(-)
Whitby
HomeZilla’s Most Searched Amenities
1
Schools
2
(-)
elementary schools
3
(-1)
grocery stores
4
(+3)
child care services
5
(-1)
coffee shops
6
(-)
high schools
7
(+2)
banks
8
(-3)
pubs
9
(-6)
parks
10
(-)
jr high schools
We hope you enjoy these March 2009 real estate trends and we look forward to your feedback!
Interesting report added by Moishe Alexander, CFC CEO
