connie vallone

Solid Real Estate Growth Predicted through 2017

In Home Buying, Home buying in West Houston, Home Values, Houston Real Estate, Investment, New construction home purchase., Pricing your home, Relocate to Houston, Texas, West Houston Real Estate on May 27, 2015 at 8:48 am

The real estate industry is expected to remain on a sustainable course of solid growth for 2015 through 2017, according to a new three-year forecast from the Urban Land Institute (ULI) Center for Capital Markets and Real Estate. The outlook – the latest installment of the semi-annual ULI Real Estate Consensus Forecast — is based on a survey of 43 of the industry’s top economists and analysts representing 32 of the country’s leading real estate investment, advisory, and research firms and organizations.

An analysis of the survey findings by ULI leader William Maher, director of North American strategy for LaSalle Investment Management in Baltimore, highlights areas of the industry and overall economy that are generating the most optimism for 2015 through 2017:

  • Net job growth is expected to be 2.9 million per year, compared to a long term average of 1.2 million. Demand for real estate, particularly office and apartments, will remain strong. Low unemployment rates should lead to healthy wage growth, although shortages of skilled workers may surface.
  • The rate for 10-Year U.S. Treasury notes will average 3 percent over the three-year period, lower than the long term average of 4.1 percent, but rising significantly over the forecast period.
  • Issuance of commercial mortgage-backed securities is expected to rise to $150 billion in 2017 (rising from $115 billion in 2015 and $133 billion in 2016). With banks and insurance companies also active, real estate lending will remain competitive and favorable for borrowers. “This is good news for the many borrowers with loans coming due over the next three years,” Maher notes.
  • Commercial real estate prices as measured by the Moody’s/RCA Index are projected to rise by an average of 7.6 percent per year, compared to a long term average increase of 5.3 percent, implying three very strong years of net appreciation for U.S. real estate.
  • Warehouse rents and hotel revenue per available room (RevPAR) are expected to be leaders among the major property types, growing by an average of 3.6 percent and 5.3 percent over the three year period — well ahead of their historical growth rates.
  • The total return rate for core unleveraged properties as measured by the National Council of Real Estate Investment Fiduciaries is projected to average 9.9 percent during 2015-2017, which is significantly higher than the expected average yield for U.S. Treasuries

Mayer points to some areas of concern, including the likelihood of higher short-term rates squeezing investment returns and causing an increase in capitalization rates. For instance, respondents expect the NCREIF capitalization rate to rise steadily from 5.3 percent in 2015 to 5.9 percent by 2017, which is “consistent with higher interest rates and borrowing costs,” he notes.

Still, the findings suggest more reasons for hope than worry, he says. “In summary, almost all U.S. real estate participants would be very pleased if the future unfolded as predicted by the ULI consensus forecast,” Mayer says. “The forecast represents almost the perfect combination of strong economic and property market fundamentals, combined with an orderly wind-down of monetary stimulus.” Although the potential exists for progress to be hampered by obstacles such as economic downturns, foreign crises, interest rate spikes, or oversupplies, “real estate pros predict three more years of smooth sailing for U.S. real estate,” he says.

In general, the performance of most commercial property sectors, as measured by vacancy rates, rental rates, total returns, and product availability is expected to exceed or hold close to the 20-year (1995-2014) averages for each category. Key predictions by commercial property type:

  • Office — The forecast predicts a continuing decline in office vacancy rates, dropping from 13.9 percent in 2014 to 13.0 percent in 2015, 12.5 percent in 2016, and 12.0 percent by the end of 2017. Survey respondents expect rental rates to rise by 4.0 percent in 2015, 4.1 percent in 2016 and 3.5 percent in 2017. NCREIF total annual returns for the office sector are projected to be 11.8 percent in 2015, 10.0 percent in 2016 and 9.0 percent in 2017.
  • Apartments – Apartment vacancy rates are forecast to rise marginally from 4.6 percent in 2014 to 4.7 percent in 2015, 5.0 percent in 2016 and 5.3 percent in 2017. Survey respondents expect rental rates to rise by 3.5 percent in 2015, 3.0 percent in 2016 and 2.7 percent in 2017. NCREIF total annual returns for the apartment sector are projected to be 9.0 percent in 2015, 8.3 percent in 2016 and 8.0 percent in 2017.
  • Retail – Retail availability rates are forecast to drop from 11. 4 percent in 2014 to 10.9 percent in 2015, 10.5 percent in 2016 and 10.2 percent in 2017. Survey respondents expect rental rates to rise by 2.0 percent in 2015, 3.0 percent in 2016 and 2.9 percent in 2017. NCREIF total annual returns for the retail sector are projected to be 10.9 percent in 2015, 10.0 percent in 2016 and 8.4 percent in 2017.
  • Industrial/warehouse – Industrial/warehouse availability rates are forecast to drop from 10.3 percent in 2014 to 9.8 percent in 2015, and to 9.6 percent for 2016 and 2017. Survey respondents expect rental rates to rise by 4.0 percent in 2015, 3.8 percent in 2016 and 3.1 percent in 2017. NCREIF total annual returns for the industrial sector are projected to be 12.0 percent in 2015, 10.5 percent in 2016 and 9.5 percent in 2017.
  • Hotel – Hotel occupancy rates are forecast to rise from 64.4 percent in 2014 to 65.2 percent in 2015, and to 65.6 percent in 2016 and 2017. RevPAR rates are expected to rise 7.0 percent in 2015, 5.0 percent in 2016 and 4.0 percent in 2017.

Predictions for single-family housing suggest that the residential sector remains in recovery mode. Survey respondents expect housing starts to rise from 647,400 in 2014 to 700,000 in 2015, 815,000 in 2016 and 900,000 by the end of 2017. The average price for existing homes in the U.S. is expected to rise by 5.0 percent in 2015, 4.0 percent in 2016 and 4.0 percent in 2017.

The market survey, conducted last month, is the seventh in a series of polls conducted by ULI to gauge sentiment among economists and analysts about the direction of the real estate industry. The next forecast is scheduled for release during October 2015.

For more information, visit www.uli.org.

Reprinted with permission from RISMedia. ©2015. All rights reserved.

If you have real estate questions, please contact me at connie@knowsrealestate.com or 713-249-4177.

How to Properly Store the American Flag

In Curb appeal, Houston Real Estate, Texas, West Houston Real Estate, West Houston REALTOR Connie Vallone on May 22, 2015 at 11:59 am

How to Properly Store the American Flag

By Emmet Pierce

Aging flags often become heirlooms and keepsakes that need to be stored carefully, says Richard R. Gideon, a flag historian. “There is a pretty large body of flag collectors out there,” he says.

The fabric used to make flags often becomes fragile over time. The key to successful storage is finding a place where your flag won’t be exposed to dirt or damaging ultraviolet light.

If you don’t have storage room in your home, a self-storage unit can be an ideal place to keep a special flag. Here are four tips on how to properly store the American flag.

1. Keep Dust and Dirt Off Your Flag. If your flag is dirty, avoid dry-cleaning it. Before you put a flag into storage, Gideon recommends cleaning it with a low-pressure vacuum and covering it with acid-free paper, which can be found at art supply stores. If your flag needs additional cleaning, Gideon suggests asking a local museum to refer you to an expert in textile conservation.

2. Keep Your Flag in a Dark Place. Never store a flag where it can be exposed to sunlight, says Philip Kauppinen, owner of Grand New Flag. Like a color photograph left in the sun, your flag gradually will begin to fade.

“If it is very old, it is going to be delicate,” he says. “You don’t want to store it in direct sunlight, because that will make it fade and brittle.”

For long-term storage, experts do not recommend folding an American flag.

3. Store Your Flag Flat. There’s a military tradition of folding American flags in the shape of a triangle, with the stars on the outside, but that’s not part of the Flag Code adopted by Congress, according to Gideon. “That is a military tradition,” he says.

On its website, Heritage Preservation, a public policy group, points out that prolonged storage in a folded condition leads to permanent creases in flags.

If you’re using a self-storage unit that is too crowded to accommodate a flat table, carefully roll the flag around a mailing tube that’s been wrapped in acid-free paper.

4. Avoid Swings in Temperature and Humidity. This means keeping flags out of attics, where summer temperatures can soar, or basements, where mold may occur, unless those rooms are temperature-controlled.

If you decide to put your flag in a self-storage unit, choose one with air conditioning and humidity control.

Choose a temperature range that would be comfortable for living conditions. Regardless of their materials, flags do best at 55 percent to 75 percent relative humidity, Gideon says.

5. Respect the Flag. Handing a flag requires proper etiquette.Tom Piazze, first vice president of the Military Officers Association of America, says you should always show respect for an American flag, even when it is in storage. The flag is a symbol of America’s courage, strength and compassion, he says, and it also has come to symbolize democracy.

“The U.S. flag is an emblem of our nation, our country,” Piazze says. “It represents our beliefs, our way of life around the world.”

Here are some guidelines for handling a U.S. flag:

– The flag should never be used as a drapery or as a decoration.

– The flag should not bear any drawing, mark, insignia, word, number or figure.

– The flag should not touch the ground.

– Never throw away a U.S. flag. The flag should be destroyed by burning it in a dignified manner. Contact your local American Legion, VFW or Boy Scout chapter for information about flag retirement ceremonies.

Source: Sparefoot.com

www.houstonenergycorridorhomes.com and vallonehomes.com

Reprinted with permission from RISMedia. ©2015. All rights reserved.

NEW LISTING! 20718 Fernwick Village Drive, Cypress, TX 77433 – MLS# 59783451

In Buying a new home, Home Buying, Home buying in West Houston, Houston Real Estate, Relocate to Houston, Relocate to Texas, West Houston Real Estate, West Houston REALTOR Connie Vallone on May 18, 2015 at 10:50 am

NEW LISTING! 20718 Fernwick Village Drive, Cypress, TX 77433 – MLS# 59783451

20718 Fernwick Village DriveBeautiful open floor plan. Bright and light with high ceilings. Step into your foyer with study/ dining to the left that leads to a huge living area that opens to your kitchen. Wood laminate and tile flooring throughout first floor living areas. Retreat to your large master suite upstairs plus two more bedrooms plus a game room. Oversize backyard plenty of room to play or entertain!

HAR Link:  http://www.har.com/20718-fernwick-village-drive/sale_59783451

 

If you are interested in buying or selling real estate in West Houston, please contact Connie Vallone with First Market Realty at 713 249 4177  or visit www.houstonenergycorridorhomes.com  or www.vallonehomes.com .

 

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