US Real Estate – 40 months of price increases

Posted on August 5, 2015 by grim

From HousingWire:

CoreLogic: Home prices rose an amazing 6.5% annually in June

Home prices nationwide, including distressed sales, increased by 6.5% in June 2015 compared with June 2014, according to the June 2015 CoreLogic Home Price Index.

This change represents 40 months of consecutive year-over-year increases in home prices nationally. On a month-over-month basis, home prices nationwide, including distressed sales, increased by 1.7% in June 2015 compared with May 2015.

Including distressed sales, 35 states and the District of Columbia were at or within 10% of their peak prices in June 2015. Fifteen states and the District of Columbia reached new price peaks—Alaska, Arkansas, Colorado, Hawaii, Iowa, Kentucky, Nebraska, New York, North Carolina, North Dakota, Oklahoma, South Dakota, Tennessee, Texas and Wyoming. The CoreLogic HPI begins in January 1976.

“The tightness of the for-sale inventory varies across cities. Throughout the U.S., the months’ supply was 4.8 months in the CoreLogic home-listing data for June, but varied greatly across cities. In San Jose and Denver, there was only 1.6 months’ supply of homes on the market, whereas Philadelphia had a 7 months’ supply and Providence had a 6.6 months’ supply,” said Frank Nothaft, chief economist for CoreLogic. “The stronger appreciation was registered in cities with limited inventory and strong homebuyer activity, such as San Jose and Denver.”

Excluding distressed sales, home prices increased by 6.4% in June 2015 compared with June 2014 and increased by 1.4% month over month compared with May 2015. Excluding distressed sales, only Massachusetts (-1.5%) and Louisiana (-0.1%) showed year-over-year depreciation in June. Distressed sales include short sales and real estate-owned transactions.
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“The current cycle of home price appreciation is closing in on its fourth year with no apparent end in sight,” said Anand Nallathambi, president and CEO of CoreLogic. “Pent-up buying demand and affordability, together with higher consumer confidence buoyed by a more robust labor market, are a potent mix fueling a 6.5% jump in home prices through June with more increases likely to come.”

Posted in Economics, Housing Recovery, National Real Estate | 88 Comments

NJ 2016 Outlook

Posted on August 4, 2015 by grim

From Joel Naroff at NJ Business:

The Naroff Review

Overview: “New Jersey’s slow economic recovery continues, but broadening job gains hold out hope that the expansion is starting to pick up steam.”

While New Jersey didn’t get hurt quite as badly as many other states during the Great Recession, its recovery has not kept pace with the nation. But there were special factors that slowed growth, including Superstorm Sandy and the collapse of the Atlantic City casino industry. With those problems fading, the economy is showing signs of coming back.

In June, the New Jersey unemployment rate gapped down to 6.1%, the lowest rate since October 2008. A decent rise in the labor force shows that workers are becoming more confident about finding a job in the state. Still, the progress on the unemployment front has been slow as the rate is well above the nation’s 5.3% level.

Job gains, which tanked with the layoffs in the gaming sector, have accelerated over the past fifteen months. While the 1% increase in payrolls between June 2014 and June 2015 was only one-half the national rate, we are finally seeing gains spread across almost all sectors. Indeed, in June, only one key component, professional and business services, posted job losses over the year.
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The housing market remains the major drag on the economy, though we are starting to see some improvement even here. Housing permit requests are bouncing back. For the first five months of the year they are up 19%, nearly twice the national increase of 11%. That happened despite the continued casino shutdown driven problems in the Atlantic City region.

The real issue, though, is the state’s judicial process for handling foreclosures and the resultant limited action to resolve the problem. While over the past year there was a significant decline in the percentage of homes in foreclosure, in May, 4.9% of the mortgaged homes in New Jersey remained in foreclosure, according to CoreLogic. The next highest state, New York, was at 3.7% while the national rate was just 1.3%. In addition, almost 8.5% of all homeowners are in distress. There is a massive overhang of distressed housing that is restraining prices, sales, construction and economic growth. This problem must be resolved if the state’s economy is to get back to more normal rates of growth.

Outlook: New Jersey’s economy is very much affected by national and international economic trends. My expectation is that the U.S. expansion will pick up steam going forward. That should help drive the state’s economy forward.

Posted in Economics, Foreclosures, Housing Recovery, New Jersey Real Estate | 77 Comments

Don’t you worry about those unintended consequences

Posted on August 3, 2015 by grim

From NJ Spotlight:

REPORT: FORECLOSURES, EMPTY HOMES STILL DRAGGING DOWN NEWARK’S ECONOMY

Baraka’s response – a plan for eminent-domain acquisition of inflated mortgages in two ‘model neighborhoods’ – may be needed citywide.

A new report finds foreclosures and housing vacancies continue to destabilize Newark, and the problems extend well beyond the two small “model neighborhoods” targeted for help by Mayor Ras Baraka.

“This is a problem that kind of spreads out throughout the city,” said Christopher Niedt, an associate professor of sociology at Hofstra University and a co-author of the study, “Our Homes, Our Newark: Foreclosures, Toxic Mortgages and Blight in the City of Newark.”

Without a more comprehensive approach, “We’re still going to see people pushed out of their homes,” Niedt said. That is particularly true for those whose mortgages were packaged into securities sold to investors, a common practice before the Great Recession, he said.

Baraka promised action later this year on a redevelopment plan intended to eliminate blight such as vacant homes. The mayor said it would include a controversial tool, eminent domain, as necessary to bring mortgage payments into line with the housing market.

“We are going to go after some of these distorted mortgages” that have left borrowers paying more than their properties are worth, Baraka told a forum organized by New Jersey Communities United.

The power of eminent domain allows governments to acquire property for public purposes such as roads or schools, even from unwilling sellers. But it frequently has been used to promote private interests, such as shopping centers and casinos.

Baraka acknowledged the tactic raises alarms in many minority communities, which often have been victimized by eminent-domain projects benefitting outside interests. But he said Newark would use it to acquire inflated mortgages, an action which has been discussed in communities across the country but never tried.

“We should be able to use eminent domain to keep people in their homes,” Baraka said.
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The city “has the right and the responsibility to use eminent domain to seize” unrealistic mortgages that have been chopped up and repackaged as private securities, said Trino Scordo, executive director of NJCU.

Baraka’s remarks are “a pretty big deal,” said Udi Ofer, executive director of the New Jersey chapter of the American Civil Liberties Union. Previous studies also have documented the prevalence of “predatory” mortgage loans, at inflated interest rates or unrealistic payment terms, in Newark and other New Jersey communities, Ofer said.

“These are really, really, really bad loans,” contributing to continued high foreclosure rates in New Jersey after problems have diminished in most of the country, he added.
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The gap can be significant, Meyer said. For 125 Newark mortgages purchased by NJCC, “the average amount of the loan was $325,000, but the average value of the property was $175,000,” he said.

Moreover, while banks often refuse mortgage modifications to individual borrowers, “they have no problem selling a mortgage at a discount to large private equity firms,” he said.

“We are going to be involved in that struggle” on behalf of residents, Baraka said. But he cautioned that progress “is going to take some time.”

Posted in Foreclosures, Housing Recovery, Mortgages, New Jersey Real Estate, Politics, Risky Lending | 146 Comments

Old people talking nonsense

Posted on August 2, 2015 by grim

From the Economist:

Myths about millennials

ONE of the perks of getting old is that you are allowed to talk nonsense about the young. Plato was said to have complained that young people “disrespect their elders” and “ignore the law”. Peter the Hermit griped that they “think of nothing but themselves” and are “impatient of all restraint”. Today, grizzled business pundits tend to mix in some praise with their gripes. But they abuse the privilege of age as much as anyone ever did.

Such modern-day sages tell employers they must adjust their management styles to meet the expectations of millennials—those born between 1980 and 2000, also known as generation Y. These people are now the largest group in America’s workforce, making up 37% of the total, compared with 34% for the baby-boomers—those born up to the mid-1960s, now retiring in droves. It is often pointed out that millennials are the first generation to have grown up in the digital era. That is true, but much else that is said about them is conjecture. They are said to be natural collaborators. Everything from their education in kindergartens to their participation in social media has turned them into team players. But at the same time they reject careerism and are allergic to being managed. Tamara Erickson, a consultant and author of “Plugged In: The Generation Y Guide to Thriving at Work”, says millennials “think in terms of how to make the most out of today and make sure that what they are doing is meaningful, interesting and challenging.” Andrew Swinand of Abundant Venture Partners, a venture-capital firm, says that doing business responsibly is the millennials’ “new religion”. The only way to attract and retain these highly strung creatures is to turn your offices into open-plan playpens and boost the corporate social responsibility (CSR) budget.

Finding evidence that contradicts all this is not hard. CEB, a consulting firm, polls 90,000 American employees each quarter. It finds that the millennials among them are in fact the most competitive: 59% of them, in the latest poll, said competition is “what gets them up in the morning”, compared with 50% of baby-boomers. Some 58% of millennials said they compare their performance with their peers’, as against 48% for other generations. They may spend much time messaging with other millennials on their smartphones, but they do not have much faith in them. Fully 37% of millennials say they don’t trust their peers’ input at work; for other generations the average was 26%. This is a generation of individualists, not collaborators. As for the idea that they are anti-careerist, CEB’s poll finds that 33% of millennials put “future career opportunity” among their top five reasons for choosing a job, compared with 21% for other generations. Likewise for corporate do-goodery: only 35% of millennials put a high emphasis on CSR, compared with 41% of baby-boomers.
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Jennifer Deal of the Centre for Creative Leadership, an executive-training outfit, and Alec Levenson of the University of Southern California studied 25,000 people in 22 countries and concluded that most generalisations about millennials as employees are “inconsistent at best and destructive at worst.”
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It would be going too far to say that there are no differences between the generations. There are variations in consumption patterns. Young people are much more likely to get their news from BuzzFeed than baby-boomers are. But these do not necessarily translate into different attitudes to work. Ms Deal notes that millennials who have been in a job for a couple of years have much more conventional attitudes to work than those of the same age who are still at university. Some differences in attitudes cross the generations. In CEB’s recent poll, 51% of millennials said they would look for a job at another organisation within the coming year compared with 37% of generation X-ers and 18% of baby-boomers.
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The most striking thing about the research data compiled by the likes of CEB and the Centre for Creative Leadership is how much workers of different generations have in common. They want roughly the same things regardless of when they were born: to be given interesting work to do, to be rewarded on the basis of their contributions and to be given the chance to work hard and get ahead.

Posted in Demographics, Economics | 35 Comments

Shiller: Housing market not efficient enough to trust comps

Posted on August 1, 2015 by grim

From Robert Shiller in the NYT:

The Housing Market Still Isn’t Rational

Home prices have been climbing. They have risen 27 percent nationally since 2012, even more in places like San Francisco. But why worry? If you accept the efficient markets theory — and believe that real estate is an efficient market — then these prices are based on “new information,” even if you don’t know what that information is.

The problem with this kind of thinking is that the efficient markets theory is at best a half-truth, as a voluminous literature on market anomalies shows. What’s more, even that half-truth is grounded mainly in the stock market, which attracts professional investors who sometimes do make the market behave efficiently.

The housing market is another matter. It is far less rational than even the often irrational stock market, for a couple of important reasons. First, most investors find it difficult to understand how housing supply responds to changes in demand. Only a small minority of people think carefully about such things. Second, it is very hard for the minority of smart-money investors who do understand such matters to bet against bubble-level prices in real estate markets. In housing, the smart money has relatively little voice.
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Short-selling helps prevent bubbles from forming, but such negative bets cannot easily occur in the housing market. You can’t routinely borrow a house and sell it, promising to buy back the same house later to repay the loan.

Markets without the possibility of making these negative bets will be inefficient. That’s because if it is not possible to short, the smart money can do no more than avoid holding an overpriced asset. Canny traders are forced to sit on the sidelines, and watch in futility as prices decline as they expected. Without short-sellers, there is nothing to stop a group of ignorant investors — who get some ill-conceived idea that a certain investment is just terrific — from bidding up prices to extravagant levels. In the housing market, that poses an enormous problem.
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During the financial crisis, some professional investors did manage to profit by correctly forecasting home price declines. They used mortgage derivatives such as collateralized debt obligations to place their bets. John Paulson of Paulson & Company is well known for very successfully profiting from his prediction of trouble in the housing market. But mortgages are not homes, and he and others like him did not beat down the emerging housing bubble before it grew out of proportion.
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The bottom line is that there is no reason to assume that the real estate market is even close to efficient. You may want to buy a house if you love it and can afford it. But remember that you cannot safely rely on “comparable sales” to judge that the price is fair. The market isn’t efficient enough for that.

Posted in Economics, National Real Estate | 18 Comments

Even NJ Hates NJ

Posted on July 31, 2015 by grim

From the Star Ledger:

N.J. residents’ positive feelings about their state hits 35-year low, poll shows

New Jersey and you, imperfect together.

The percentage of New Jersey residents considering their state a good or excellent place to live dropped to a 35-year low, according to a Monmouth poll released Thursday.

The poll said 55 percent had a positive opinion about their state, down from 63 percent in February and the lowest percentage recorded since the question was first asked in 1980. The previous low point was 57 percent in August 2011.

Residents felt differently about their hometowns: 71 percent felt positively, virtually unchanged from 72 percent in February.

“New Jerseyans still like their towns and their neighbors,” said Patrick Murray, director of the Monmouth University Polling Institute in West Long Branch. “They’re just having a hard time with the state as a whole.”
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The statewide views lowered the Garden State Quality of Life Index to +18, down from +23 in February. It was last that low in September 2014, and hasn’t dropped below that since September 2010.

Posted in Demographics, Economics, Employment, New Jersey Real Estate, Unrest | 119 Comments

Fewer Underwater Homeowners in NJ

Posted on July 30, 2015 by grim

From the Record:

Share of underwater homeowners declines in NJ, US

About one in every seven New Jersey homeowners with mortgages, or 14.6 percent, are “seriously underwater” — owing much more on their mortgages than the home is worth, according to RealtyTrac, a California real-estate information company.

That’s down from 19 percent, or almost one in every five, in the second quarter of 2014. The drop in seriously underwater properties is the result of a rise in home prices, which is giving homeowners more equity.

Nationally, about 7.7 million homeowners, or 13.3 percent of those with mortgages, are seriously underwater, which RealtyTrac defines as owing at least 25 percent more than the property is worth. The percentage of seriously underwater homeowners has dropped from 17.2 in the second quarter of 2014.

Unsurprisingly, homes bought during the housing boom — when mortgage standards loosened and home prices soared — account for a large share of all those seriously underwater. Nationally, homes owned for seven to 11 years accounted for 38 percent of all seriously underwater properties, RealtyTrac said Wednesday.

Underwater mortgages affect the entire housing market, because people who owe more than their homes are worth can’t sell without taking a loss. That has led to a low inventory of homes for sale, slowing housing activity. In addition, underwater homeowners who struggle to pay their mortgages can’t simply solve their problems by selling the home.

Posted in Economics, Housing Recovery, New Jersey Real Estate | 218 Comments

Case Shiller – US Up 4.4% YOY in May

Posted on July 29, 2015 by grim

From the WSJ:

Home-Price Growth Remained Solid in May

Home prices made solid gains in May, according to a report released Tuesday, as home price growth appears to be largely flattening out after a long, uneven recovery.

The S&P/Case-Shiller Home Price Index, covering the entire nation, rose 4.4% in the 12 months ended in May, slightly greater than a 4.3% increase in April.

The 10-city and 20-city indexes saw similar increases in May as in April. The 10-city index gained 4.7% from a year earlier, slightly stronger than a 4.6% increase in April. The 20-city index gained 4.9% year-over-year, identical to the increase in April.

Economists surveyed by The Wall Street Journal expected a 5.7% increase to the 20-city index.
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Price gains have remained largely flat in 2015 at just over 4%, after low double-digit gains in 2013. Economists said that is likely a good sign that the market is stabilizing closer to levels that most buyers can afford.

David Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices, said that price gains are likely to continue slowing, eventually stabilizing at around 3%.

Posted in Economics, Housing Recovery, National Real Estate | 139 Comments

NJ Building Permits Near 30 Year High

Posted on July 28, 2015 by grim

From the Star Ledger:

N.J. home building permits soar to nearly 30-year high

Homebuilders in New Jersey received more permits in June than they had in nearly 30 years, new data shows.

Roughly 4,800 permits were authorized in New Jersey last month, the U.S. Census Bureau reported, an increase of 12 percent from May. Nearly 80 percent of the permits obtained in June were for multifamily projects, the data shows.

Patrick O’Keefe, director of economic research at CohnReznick, said the 4,792 units authorized in June represent the largest number of permits obtained since mid-1988. The 3,776 multifamily units approved in June was the highest level of any month from 1980 forward, he said.

“It was the third consecutive month in which multifamily authorizations reached a historic peak,” O’Keefe said in a memo.

More than 1,000 single-family permits were obtained in June, the Census data shows, a jump of roughly 29 percent over May. June was only the fifth month since the beginning of 2008 that more than 1,000 single-family construction permits were issued, O’Keefe said.

Posted in Economics, New Development, New Jersey Real Estate | 230 Comments

Home prices near peaks across US

Posted on July 27, 2015 by grim

From HousingWire:

Black Knight: Home prices approach pre-crisis peak

Home prices are approaching their pre-crisis peak, according to a new report from Black Knight Financial Services (BKFS).

Black Knight’s latest Home Price Index report, based on May 2015 residential real estate transactions, showed that the U.S. HPI is now just 6.5% off the June 2006 peak of $268,000, and up over 25% from the market’s bottom.

The Black Knight HPI combines the company’s extensive property and loan-level databases to produce a repeat sales analysis of home prices as of their transaction dates every month for each of more than 18,500 U.S. ZIP codes.

The Black Knight HPI represents the price of non-distressed sales by taking into account price discounts for REO and short sales.

According to Black Knight’s report, the HPI now rests at $251,000, up 1.1% over the previous month and up 5.1% over the previous year.

New York led gains among the states, seeing a 1.8% in month-over-month appreciation.
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Of the nation’s 40 largest metros, 12 hit new peaks:

Austin, TX up 1.0% to $279,000
Boston, MA $up 1.5% to 402,000
Columbus, OH up 0.7% to $184,000
Dallas, TX up 1.0% to $211,000
Denver, CO up 1.5% to $318,000
Houston, TX up 0.9% to $215,000
Nashville, TN up 1.2% to $216,000
Pittsburgh, PA up 1.4% to $187,000
Portland, OR up 1.4% to $311,000
San Antonio, TX up 0.8% to $190,000
San Francisco, CA up 1.5% to $713,000
San Jose, CA up 1.1% to $854,000
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The top 10 movers on the state level were:

New York: 1.8%
Vermont: 1.6%
New Jersey: 1.6%
Connecticut: 1.6%
New Hampshire: 1.6%
Rhode Island: 1.6%
Pennsylvania: 1.5%
Massachusetts: 1.5%
Oregon: 1.4%
Colorado: 1.4%

Posted in Demographics, Economics, Housing Recovery, National Real Estate | 132 Comments

Vote for Christie – Get a Tunnel

Posted on July 25, 2015 by grim

From the NYT:

Chris Christie Claims He Will Pursue the Trans-Hudson Tunnel Project as President

Several days of severe delays for rail commuters trying to cross the Hudson River this week has been a painful reminder of the deteriorating state of the tunnels that carry the trains and brought renewed attention to a decision made years ago to halt a project that might have helped improve the situation.

In a radio interview that will be broadcast this weekend, Gov. Chris Christie of New Jersey made clear his reasoning for blocking the construction of a new tunnel and other infrastructure in 2010 that was intended to increase passenger service capacity between his state and Manhattan. He said it was a regional project that would have left New Jersey taxpayers to bear the brunt of its cost.

The governor, a Republican candidate for president, added that if he were to make it to the White House, he would push for an equitable solution.

“If I am president of the United States, I call a meeting between the president, my secretary of transportation, the governor of New York and the governor of New Jersey and say, ‘Listen, if we are all in this even Steven, if we are all going to put in an equal share, then let’s go build these tunnels under the Hudson River,’ ” Mr. Christie said in an interview with the radio talk show host Larry Kudlow, which will be broadcast on Saturday on WABC-AM.

“Then, everyone has an incentive to have the project run right, to run efficiently because everybody is on the hook,” Mr. Christie added.

The governor’s comments — and his hypothetical phrasing — has attracted the attention of his critics, who say his statements emphasize how little he has done to help improve transportation.

“This is not a hypothetical issue, this is a real issue, and he could be doing something about it,” said Martin Robins, the founding director of the Alan M. Voorhees Transportation Center at Rutgers University, who was the director of the tunnel project during the mid-1990s. “The question is, what has he done, what will he do in the next 18 months as the governor of New Jersey?”

Posted in Economics, New Jersey Real Estate, NYC, Politics | 51 Comments

Canary?

Posted on July 24, 2015 by grim

From Bloomberg:

Hamptons Home Prices Fall as More Sellers List Properties

The real estate market in New York’s Hamptons has cooled from a frenzied pace, with the median sale price in the beachfront towns falling to the lowest in a year and a half.

In the three months through June, Hamptons homes sold for a median of $849,000, down 6.5 percent from the second quarter of 2014, according to a report Thursday by brokerage Douglas Elliman Real Estate and appraiser Miller Samuel Inc. Completed deals in the area, the favored summer retreat of Wall Street financiers, tumbled 16 percent to 590.

More owners are putting their homes on the market after a surge in demand pushed prices to a seven-year high in 2014. Listings at the end of June totaled 1,694, up 2.9 percent from a year earlier and higher than the six-year quarterly average of 1,571, the firms said. With increased choices in most price ranges, shoppers were able to take their time on deals.

“The intensity has slowed a bit,” said Jonathan Miller, president of New York-based Miller Samuel and a Bloomberg View contributor. “Any time you have a pronounced period of growth, which we had in 2014, that pulls in more inventory because sellers say, ‘Hey it’s time to sell.’”

At the current pace of transactions, it would take 8.6 months to sell all the homes on the market, up from 7.1 months at the end of June 2014, the firms said.

Posted in Housing Bubble, Housing Recovery, Shore Real Estate | 93 Comments

Home sales at highest level since 2007

Posted on July 23, 2015 by grim

From Reuters:

U.S. home sales approach eight-and-a-half-year high, prices surge

U.S. home resales rose in June to their highest level in nearly 8-1/2 years, a sign of pent-up demand that should buoy the housing market recovery and likely keep the Federal Reserve on track to raise interest rates later this year.

The National Association of Realtors said on Wednesday existing home sales increased 3.2 percent to an annual rate of 5.49 million units, the highest level since February 2007.

“The economy really has the wind at its back now,” said Chris Rupkey, chief financial economist at MUFG Union Bank in New York.

Home resales this year are on track to record their biggest gain in eight years, the NAR said.

Economists had forecast sales rising to an annual rate of 5.40 million units last month. Sales were up 9.6 percent from a year ago.

June’s solid home sales report came on the heels of last week’s strong housing starts and building permits data. A tightening labor market is starting to push up wages, helping to boost demand for housing, especially among young adults.

But a tight supply of properties for sale remains a constraint. The string of strong housing reports indicate the economy continues to be on firmer footing despite a drop in retail sales and a slowdown in job growth last month.
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“Strong home resale numbers throughout the spring and into summer are welcome news to those who feared the housing market was a weak point in the overall economy,” said Bill Banfield, vice president at Quicken Loans in Detroit.

“As housing numbers trend more positive, the Fed will become increasingly comfortable in beginning to raise rates.”
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At June’s sales pace, it would take 5.0 months to clear houses from the market, down from 5.1 months in May. A six-month supply is viewed as a healthy balance between supply and demand.

With supply well below what it was during the housing bubble in 2006, the median price for a previously owned home increased 6.5 percent from a year ago to a record $236,400.

While some buyers may be forced out of the market by higher prices, homeowners are seeing their equity rise. That could lead to more houses being put up for sale. Realtors and economists say insufficient equity has contributed to the tight housing inventories.

Posted in Housing Recovery, National Real Estate | 103 Comments

Time to clean house? Vote all incumbents out.

Posted on July 22, 2015 by grim

From the APP:

Where does New Jersey’s job market rank?

Just when you thought it was safe to come out.

New Jersey’s job market, which showed signs of life early this year, slumped in June, leaving the Garden State 36th in job growth nationwide, according to statistics released during the past week.

“I have a feeling this is that pattern of three steps forward, one step back,” said James W. Hughes, an economist and dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University. “It’s not a smooth, even pattern of job growth.”
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New Jersey’s rocky path to recovery has grabbed national attention thanks to Gov. Chris Christie’s presidential bid. But there are stronger forces at work.

Perhaps the biggest? New Jersey’s suburban landscape – with isolated corporate campuses, sprawling housing developments, and long, gas-guzzling commutes – was a strength in the ‘80s and ‘90s, but it has fallen out of favor in the new economy, Hughes said.

The giant millennial generation, now in its 20s and 30s, is quickly replacing the baby boom generation in the workplace. It is technically savvy. It prizes teamwork. It doesn’t mind mass transit. It can work any time of the day. And employers are following them, Hughes said.

The shift has prompted New Jersey business groups and entrepreneurs to call on the state to adapt – whether to fix the crumbling transportation network or finds ways employers can partner with high schools and colleges to convince talented students to stay in New Jersey.

“The paradigm shift is, let’s forget about the blame game,” Tom Bracken, president of the New Jersey Chamber of Commerce, said during a recent interview. “Let’s forget about having 15 hearings on the (depleted) transportation trust fund; what else do you need to know? Let’s talk about hearings and meetings where we have solutions and identify the real problems that we need to address, and find ways to start working on those problems.”

Posted in Demographics, Economics, New Development, New Jersey Real Estate | 169 Comments

Everyone wants out?

Posted on July 21, 2015 by grim

From the Star Ledger:

14 percent of N.J. businesses thinking of moving out of state

The New Jersey Chamber of Commerce’s biannual Baker Tilly Spring Economic Outlook Survey brings grim news for the state’s lagging employment prospects: Fourteen percent of those surveyed said they were currently considering moving their businesses out of New Jersey.

Ten of the 14 business leaders considering relocating their businesses blamed high taxes or high cost of living as their reason. Just four cited opportunities elsewhere.

“It is no surprise that high taxes are at the top of the list,” said Tom Bracken, president and CEO of the New Jersey Chamber of Commerce.

“New Jersey-based corporations pay a 9.4 percent tax rate, one of the highest in the country. Despite that, some in the state Legislature last month proposed increasing the corporate tax rate again to 10.75 percent. We fought hard against it and thankfully Gov. Christie vetoed it.”
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There was also some good news in the Baker Tilly survey, which consults 100 Garden State business owners, CEOs and senior executives. More than four out of 10 respondents (42 percent) said they expect the state’s economy to improve over the next 12 months, while only 16 percent said they expect it to worsen. This is an improved outlook from survey results a year ago, when only 35 percent of respondents said they expected the economy to improve, while 26 percent said they expected it would worsen.

And large majority of respondents — 82 percent — said they expect their companies will either maintain or increase their staffing levels over the next 12 months. Some 77 percent of the respondents said they expect their companies’ revenue to stay even or increase.

Posted in Economics, Employment, New Jersey Real Estate | 150 Comments