Sociology 5811: T-Tests for Difference in Means Wes Longhofer, pinch-hitting for Evan Schofer.
January 18, 2011 Dr. Stanley D. Longhofer WSU Center for Real Estate.
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Transcript of January 18, 2011 Dr. Stanley D. Longhofer WSU Center for Real Estate.
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The 2011 Economic Outlook for Real Estate Investors
January 18, 2011
Dr. Stanley D. LonghoferWSU Center for Real Estate
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Real GDP Growth since 1985
-10
-8
-6
-4
-2
0
2
4
6
8
10
1985 1990 1995 2000 2005 2010Source: Bureau of Economic Analysis
Percent
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Real GDP Growth since 1950
-10
-5
0
5
10
15
20
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010Source: Bureau of Economic Analysis
Percent
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Unemployment Rate
2
4
6
8
10
12
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
WichitaU.S.
Source: U.S. Bureau of Labor StatisticsData are seasonally adjusted
Percent
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Total Non-Farm Employment
125,000
130,000
135,000
140,000
U.S
. Em
ploy
men
t in
1,00
0s
250
275
300
325
Wic
hita
Em
ploy
men
t in
1,00
0s
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
WichitaU.S.
Source: U.S. Bureau of Labor StatisticsData are seasonally adjusted
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Wichita Office Employment
128
130
132
134
136
138
140
142
144
146
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Source: WSU Center for Real Estate using data from the U.S. Bureau of Labor Statistics
Data are seasonally adjusted
Employment in 1,000s
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Wichita Retail Employment
54
55
56
57
58
59
60
61
62
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Source: WSU Center for Real Estate using data from the U.S. Bureau of Labor Statistics
Data are seasonally adjusted
Employment in 1,000s
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Wichita Industrial Employment
70
80
90
100
110
120
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Source: WSU Center for Real Estate using data from the U.S. Bureau of Labor Statistics
Data are seasonally adjusted
Employment in 1,000s
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WSU Economic Indices
80
90
100
110
120
130
2003 2004 2005 2006 2007 2008 2009 2010
Leading IndicatorsCurrent Conditions
Source: WSU Center for Economic Development and Business Research
Index
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Consumer Inflation
-4
-2
0
2
4
6
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Consumer InflationCore Inflation
Source: U.S. Bureau of Labor Statistics
Percent
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Mortgage Rates
2
4
6
8
10
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
30-year Fixed Rate1-year AdjustableMBA Forecast
Sources: Freddie Mac; Mortgage Bankers Association
Percent
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Mortgage Underwriting Standards
-20
0
20
40
60
80
100
1990 1995 2000 2005 2010 2015
AllPrimeAlternativeSubprime
Source: Board of Governors of the Federal Reserve System
Net Percentage of Banks ReportingTightening Standard of Mortgages
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Commercial Mortgage Standards
-40
-20
0
20
40
60
80
100
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Source: Board of Governors of the Federal Reserve System
Net Percentage of Banks ReportingTightening Standard for Mortgages
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Existing Home Sales Activity
3,000
4,000
5,000
6,000
7,000
U.S
. Sal
es in
1,0
00s
4,000
6,000
8,000
10,000
12,000
Wic
hita
Sal
es
2006 2007 2008 2009 2010
WichitaU.S.
Sources: NAR and South Central Kansas MLSNote: Data are seasonally-adjusted annual rates
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Existing Home Sales by Month
200
400
600
800
1,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
201020092008
Source: South Central Kansas MLS
Units
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Existing Home Inventories
0
2
4
6
8
10
12
2006 2007 2008 2009 2010
WichitaU.S.
Sources: NAR and South Central Kansas MLSNote: Data are seasonally adjusted
Months' Supply
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U.S. New Home Activity
300
600
900
1,200
1,500
1,800
2,100
U.S
. Sin
gle-
Fam
ily B
uild
ing
Per
mits
200
400
600
800
1,000
1,200
1,400
U.S
. New
Hom
e S
ales
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
SalesPermits
Source: U.S. Bureau of the CensusData are seasonally-adjusted annual rates
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New Home Sales Activity
200
400
600
800
1,000
1,200
U.S
. Sal
es in
1,0
00s
0
1,000
2,000
3,000
4,000
5,000
Kan
sas
Sal
es
2006 2007 2008 2009 2010
KansasU.S.
Sources: U.S. Census Bureau and participating Kansas REALTOR MLS systemsNote: Data are seasonally-adjusted annual rates
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New Single-Family Building Permits
0
500
1,000
1,500
2,000
U.S
. SF
Per
mits
in 1
,000
s
0
50
100
150
200
250
300
Wic
hita
Are
a S
F P
erm
its
2006 2007 2008 2009 2010
WichitaU.S.
Sources: Wichita Area Builders Associaiton and U.S. Bureau of the CensusData are seasonally adjusted annual rates
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Home Price Appreciation
-10
-5
0
5
10
15
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
WichitaU.S.
Source: Federal Housing Finance Agency (FHFA)
Percent
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Home Price Appreciation
100.00
120.00
140.00
160.00
180.00
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
WichitaU.S.
Source: Federal Housing Finance Agency (FHFA)
Index: 2000q1 = 100
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Kansas Home Price Appreciation
95.00
100.00
105.00
110.00
115.00
2007 2008 2009 2010
Kansas City Lawrence ManhattanTopeka Wichita
Source: Federal Housing Finance Agency (FHFA)
Index: 2007q1 = 100
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What Can We Expect for 2011?
2010 was a tumultuous yearHard to tell the current in the market with all the ripples
How fast markets recover depends in large part on the rest of the economy
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Wichita Forecast
2009 Actual
2010 Forecast
2011 Forecast
Total Home Sales
8,617 units-14.2%
8,140 units-5.5%
8,680 units+6.6%
Building Permits
1,256 units-29.2%
1,070 units-14.8%
1,080 units+0.9%
Home Price Appreciation
+0.4% -0.1% +1.4%
Sources: South Central Kansas MLS; U.S. Bureau of the Census;
Federal Housing Finance Agency; WSU Center for Real Estate
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2011 Housing Markets Forecast
Kansas City
Lawrence
Manhattan Topeka Wichita
Sales25,050 units
+2.5%
1,430 units
+9.2%
620 units+3.3%
2,700 units
+1.1%
8,680 units+6.6%
Permits
2,100 units
+1.9%
220 units
+10.0%
190 units-5.0%
310 units
+14.8%
1,080 units+0.9%
Home Prices -1.3% -0.5% +0.8% -0.5% +1.4%Sources: Heartland MLS; Lawrence Board of
REALTORS®; Manhattan Association of REALTORS®; Topeka Area Association of REALTORS®; South Central
Kansas MLS; U.S. Bureau of the Census; City of Manhattan; Federal Housing Finance Agency; WSU
Center for Real Estate
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Laying a Foundation for Real Estate in Kansas
WSU Center for Real Estate