Slow Down?

[J Grant]

The problem is that the "cure" to the last recession was (among other steps) to lower rates as low as possible. The economy has improved in the 10-years since, but the recent federal tax cut is a form of stimulus that was not seen by economists as being needed, given the growing economy. The resulting risk of over-heating in the economy is the root of inflation. Raising rates is a necessary step for the Fed to take in response, and it's not in itself something that will cause a recession at this point. What it will hurt, however, is the real estate sector, as many property owners don't want to buy new as they have a mortgage that is at a rate below what could be found in today's market.
I've said it before on here, but appraising is a profession that thrives in recessionary times, and vice versa. It's not a surprise that as the economy is strong, work for appraisers is slower.

But the economy is not really "strong". The stats I read were Obama added 2,4 % new jobs his last 16 months and Trump added 2.1% new jobs his first 16 months...and added 1.5 trillion to the debt to get there. Not exactly an inspiring turn around. What really hurts this admin and thus the nation is the unstable leadership, constant turmoil, staff in key positions getting fired or quitting, taking a hard line on tariffs then wavering, shutting down govt in a tantrum over his wall . The feds way over estimated the economy , Wall Street big losses and GM plant closings are a harbinger. Trump is right about the fed refusal to cut rates and their rate hikes, way out of touch with the reality because housing market is such a huge part of the economy that when it stalls, it can drag everything else down. What happened to Janet Yellin why didn't she stay on? A lot of mediocre or limited vision people running agencies now, if even the govt reopened people might regain confidence.

 

[J Grant]

Every year people post that it so slow from around Thanksgiving through February or March. Real estate is seasonal. Everyone take a breath and relax already with the doomsday predictions.

That being said, I understand the angst some appraisers feel especially if appraising is their only income source. Fortunately for me, that is not the case.[/QUOTE]

Never been this slow this seasonal time of year either. Most people understand the holidays and seasonal and experience a vast drop off this year compared to same season in past years. Lucky for you...for me appraisal was a full time sole profession, well time to re train, there might be some action pick up for sales in the spring if conditions stabilize but long term the outlook for res appraisals is contracting.

 

[James Micozzi]

Never been this slow this seasonal time of year either. Most people understand the holidays and seasonal and experience a vast drop off this year compared to same season in past years. Lucky for you...for me appraisal was a full time sole profession, well time to re train, there might be some action pick up for sales in the spring if conditions stabilize but long term the outlook for res appraisals is contracting.[/QUOTE]

Baloney. Every year there are numerous comments from appraisers throughout the country saying "It has never been this slow" during this time of year. I have been on this forum for years and have seen these same comments every year during the traditional slower winter months.

 

[ucbruin]

I agree with JG....

Most of us have been appraisers for multiple decades and have developed a feel regarding changing seasonal volume....
For me 2018 had a different vibe....

And I also agree with Gobears81....
Some of my highest income years were those at the beginning of a down economy (people needing $$$ refi'ing) and the start of the recovery....

 

[J Grant]

[QUOTE="James Micozzi, post: 2885545,Baloney. Every year there are numerous comments from appraisers throughout the country saying "It has never been this slow" during this time of year. I have been on this forum for years and have seen these same comments every year during the traditional slower winter months.[/QUOTE]

The appraisers are saying that even though they have been slow seasonally in prior years, they were never dead, as in nothing, like this. You don't even appraise full time so your personal feeling for the seasonal slow down is lacking. I've been reading the comments for years and this years's comments are different. There does come a tipping point in a profession, and appraisals on res lending side has been hit with a combination of factors just in the past year or two plus that are playing out now. Of course if res lending contracts it does impact commercial to a lesser degree for those st gens who do some mtge lending work.

 

[James Micozzi]

[QUOTE="James Micozzi, post: 2885545,Baloney. Every year there are numerous comments from appraisers throughout the country saying "It has never been this slow" during this time of year. I have been on this forum for years and have seen these same comments every year during the traditional slower winter months.

The appraisers are saying that even though they have been slow seasonally in prior years, they were never dead, as in nothing, like this. You don't even appraise full time so your personal feeling for the seasonal slow down is lacking. I've been reading the comments for years and this years's comments are different. There does come a tipping point in a profession, and appraisals on res lending side has been hit with a combination of factors just in the past year or two plus that are playing out now. Of course if res lending contracts it does impact commercial to a lesser degree for those st gens who do some mtge lending work.[/QUOTE]


Wrong. I do appraise full time and have been for years. I said that I feel for appraisers whose only source of income is appraising, which is not the case for me. You made the conclusion that I only appraise part time. It seems that you believe my opinion is not valid as it differs from yours.

 

[J Grant]

Your opinion about this year slowdown is different than almost every other appraiser on the board, your opinion is valid for you personally, it just does not jibe with what virtually every other appraiser posting reports.

I hope things turnaround ! As do all of us....

 

[Gobears81]

But the economy is not really "strong". The stats I read were Obama added 2,4 % new jobs his last 16 months and Trump added 2.1% new jobs his first 16 months...and added 1.5 trillion to the debt to get there. Not exactly an inspiring turn around. What really hurts this admin and thus the nation is the unstable leadership, constant turmoil, staff in key positions getting fired or quitting, taking a hard line on tariffs then wavering, shutting down govt in a tantrum over his wall . The feds way over estimated the economy , Wall Street big losses and GM plant closings are a harbinger. Trump is right about the fed refusal to cut rates and their rate hikes, way out of touch with the reality because housing market is such a huge part of the economy that when it stalls, it can drag everything else down. What happened to Janet Yellin why didn't she stay on? A lot of mediocre or limited vision people running agencies now, if even the govt reopened people might regain confidence.

GDP growth in 2015 - 2017 was all over the place prior to 2015, but in 2015 - 2017 was generally between 1% and 3% per year - not bad, but slow and steady. Last two quarters were 4.2% and 3.5%. A GDP growth rate above 3% is regarded as strong by most indicators. Outside of the last month, the stock market has been quite strong. Even with the sharp downturn last month, the Dow Jones is up 35% from 3-years ago (or 45% from 35-months ago).
I have concerns about the federal deficit, as you do also. Corporate, personal, and governmental debt are all quite high. This is not a perfect economy and I am not attempting to frame it as such. But not calling it a strong economy is off by most indicators. There are winners and losers to each economy, and the discussion on this forum about whether there should be a maximum wage for CEOs tells you which income bracket is benefiting most from the economy.

 

[Terrel L. Shields]

Maybe the fed will wake up one day, look around and realize the short term uptick of jobs from cutting taxes was nothing more than that.

Actually the general economy is doing fine. It is mostly real estate.

Everyone take a breath and relax

exactly. explanation below.

The problem is that the "cure" to the last recession was (among other steps) to lower rates

Key problem isn't it? Interest rates were too low after 9/11. So lowering the rate was throwing gasoline on a fire. I think Bernanke, and the economic wunderkinds of government compounded the problem by 1. underestimating the role of real estate in the economy, 2. failing to regulate the Byzantine interlocked nature of securities who were used to "back" each other, something N. N. Taleb had warned against and numerous economists were saying was a house of cards. Pull one card and they don't support each other, rather it collapses.

The pointless gesture of going to zero created its own vacuum. It is harder on the economy to raise than lower rates. Everyone wants to protect low interest loans. Moving has the double whammy. The buyers for your home must pay more and what you replace it with will cost more. People now cannot imagine paying 6% for money, but for perspective, my construction loan in 1991 was over 11%, and first secondary market loan about 9%. I bought a new pickup in 1995 & got a great interest rate of 8.5%. My last car loan was 4.25% in 2013. Normalizing rates in the 6% range will take time. And we've not had a recession for over ten years. Long overdue. The Fed likely will control this process pushed, in part, by politics of the moment.

 

[ucbruin]

Wrong. I do appraise full time and have been for years. I said that I feel for appraisers whose only source of income is appraising, which is not the case for me. You made the conclusion that I only appraise part time. It seems that you believe my opinion is not valid as it differs from yours.

Curious....
Do you consider the entire 2018 year and the Nov/Dec months to reflect your normal personal appraisal volume history?