Four out of five U.S. homes have a DVR, subscribe to Netflix, or use video-on-demand (VOD) service from their TV provider. That’s up from three out of four, last year. And, more significantly, now more than half of adults (57%) get a subscription VOD service (Netflix, Hulu, etc…). What, may you ask, does this have to do with housing or real-estate? Well, aside from the fact that I’m always actually interested in how we live in our homes, not just the homes themselves, it may have a huge impact on the future. As I wrote a while back, the size and shape of the average American home is changing. With more than half of adults getting their TV via the Internet, you might want to think about the future shape of the living room, and the place of the TV in it. Particularly if you’re planning on a remodel.
I just discovered the coolest thing — The Bloomberg Week Ahead. Maybe you folks already know about it, but it’s news to me, and it seems excellent. Granted, it’s not completely real-estate focused, but it does hit major economic highlights, including those pertaining to mortgage and real estate (e.g., it teed up the National Association of Realtors report, at 10AM Eastern, today). And with the interrelation of global economies and markets I’ve been writing about for a while, many of the other announcements are of interest as well.
My article on Tuesday may have gotten you thinking about putting your money to work somewhere harder in real estate. And that may, in turn, have gotten you lamenting the fact that you totally missed out on the Detroit recovery. Well, first of all, the Detroit recovery may not have been quite as solid as it’s been reported (sure, you can’t buy too many $500 houses any more, but median property values are still down 50% from 2006 peaks). But never mind Detroit. Detroit doesn’t have a beach. You need to be shopping in Puerto Rico.
The future of the housing market remains precarious — and remains precariously tied to the overall economy. As I wrote last week, there are a number of reasons that housing starts may be behind schedule — not least of all, a shortage in the labor market. January was also a rough month from a weather perspective, so it’s no surprise that housing-starts were down. However, building permits were also down in January, down 0.2%. Now, that’s a very small change, but it actually hides much larger volatility, with a 2.1% increase in multi-family units, but a 1.6% decrease in single-family permits.
A few months ago, I wrote about the fact that with U.S. houses priced as they are, and the strength of the U.S. dollar, it was perhaps time to consider shopping for your next property somewhere up north. Since then, the housing market has stayed strong, the dollar has stayed strong, and Chinese investment in the high-end of U.S. properties has continued. As a result, we’re now seeing actual flight from our neighbors to the north. Canadians are using the current housing/dollar market to take some profits.