 |  |
John Burns
John Burns helps many of the largest companies in the industry with strategy and monitoring market conditions. He can be reached at jburns@realestateconsulting.com. |
|
Recent Columns from John Burns |
|
|
|
The worst markets in the country are seeing demand bottoming out and supply topping out. This is an early indicator that market recovery is on its way.
8/25/2008
Slowed Permit Levels are Part of the Housing Cycle
Single-family construction is down 63% from the peak. Construction is unlikely to fall much further, and should rebound quickly if this cycle follows the pattern of previous cycles.
4/24/2008
Measuring Housing Affordability Market by Market
Housing Giants columnist John Burns outlines how affordability issues have affected different housing markets in this economic cycle — and what it means for home builders.
2/22/2008
Keys to D.C. Housing Market Recovery
Housing Giants columnist John Burns explains the necessary demand, supply and affordability conditions that must occur for the Washington, D.C., housing market to see significant improvement.
12/1/2007
Homebuilding Executives Need Focus on Existing-home Market
Real-estate consultant and Housing Giants columnist John Burns advises home building executives to track the velocity of total sales in their price range and maximize market share of those home sales.
8/1/2007
Homebuilders Say Sayonara to Entry-level, Hello to Move-up Buyers
Entry-level home ownership has died down after record highs in 2005. Home builders, hungry to eat up inventory, are turning to a more stable buyer demographic: move-up buyers.
6/1/2007
Vacant Homes Tell True Industry Story
Although we see signs of improvement in new- home sales, we believe these are primarily incentive-driven, and the market correction that began taking shape in 2006 is far from over. One reason we are cautious is that there are currently 2.1 million vacant homes for sale, which is 800,000 more than usual.
4/1/2007
Home Builders Face Inventory Downturn
Borrowing against the future has weakened the demand for homes over the next few years. Falling interest rates and creative financing allowed approximately 2 million more renters than usual to transition into homeownership.
2/1/2007
A New Housing Supply and Demand Paradigm
Although the traditional housing market measures still apply, here is an additional supply/demand measure that also needs consideration.
12/1/2006
Growing Economies Affect Big Markets
Two of the largest housing markets in the country that have not received a lot of attention are examined: the metropolitan areas of Minneapolis and Lakeland, Fla.
10/1/2006
84% of Markets Are Overpriced
An affordability study of the 100 largest housing markets across the nation finds the vast majority of metropolitan areas are currently overpriced and out of reach for those within a median income level bracket. The most problematic markets are on the east and west coast. The Housing Cycle Barometer™ applies a formula using current and historic income levels, mortgage rates and home prices to assess home affordability. It can also identify markets that have potential housing bubble situations.
9/6/2006 2:04:00 PM
Reduce Building Costs & Risk
8/22/2006 11:55:00 AM
Midwest Jobs Affect Housing Market
This month we look at two Midwestern cities where the employment situation has had a significant affect on the housing market. One market is very affordable and growing rapidly, while the other is overpriced and oversupplied.
8/1/2006
Picking up Speed
Because many Chicago residents retire in Fort Myers, Fla., we thought it would be interesting to feature both markets. Chicago is an established market where a lackluster economy appears to be on the rebound. To the contrary, Fort Myers is a new market where housing construction is driving an unsustainable boom.
6/1/2006
2006: The Year of the Apartment
With home prices now beyond the reach of many middle-income households, this will be the year that the apartment market surges. Apartment owners have not been able to raise rents substantially over the last 6 years because of...
5/2/2006 12:44:00 PM
Sprawl Is Creating Problems and Opportunities
This is going to be the year that the best builders distinguish themselves from the pack. The substantial sprawl that has occurred in many markets is resulting in very competitive situations where only the strongest will survive.
4/1/2006 1:25:00 PM
The Comeback Trail
This month, we feature two markets that have strong job growth and excellent affordability: Austin and Salt Lake. Both markets are experiencing job growth in almost every sector of the economy (see chart included) and both markets have experienced very little price appreciation this decade.
4/1/2006
They Know How to Sell Homes in Denver and Austin
Thus far in 2006, sales per community are down in comparison to prior years in most markets around the country. Salespeople around the country can learn from the salespeople in Denver and Austin. Sales professionals in these two cities are generally the best in the country simply because they have been forced to become excellent or find another profession.
3/1/2006 1:18:00 PM
Builders Face Many Decisions on Risk
The purpose of this article is to help building industry investors understand that builders take varied levels of risk. Therefore, when evaluating a builder's current or future performance, it is important to consider the following:
2/8/2006
Southern Exposure
This month, we feature two Southern markets that rank among the 13 largest in the country.
2/1/2006
Reports of California's Demise are Overblown
Giant Market: San Diego After unprecedented levels of price appreciation, the San Diego market has returned to normal market conditions. Three factors have contributed to the softening of the market: While some overpriced situations exist, market demand and supply is largely in balance. The 19,400 jobs created in the last 12 months exceed construction levels by 23 percent, which is a healthy de...
12/1/2005
Potential Overbuilding Reversed by Katrina
Featured Major Market: Houston Houston has steadily risen from a relatively small housing market in 1987 to the third largest housing market in the country. Houston has always been known for its pro-growth, pro-developer attitudes, which has lead to periods of overbuilding in the past. We were concerned about potential overbuilding in Houston until Hurricane Katrina hit New Orleans.
10/1/2005
Rising Arizona
8/2/2005
GIANTS Steer toward Beauty and the Beach
Featured Major Market: Los Angeles If you don't build it, they will come anyway. If you are dealing with government agencies or citizens groups who believe that if they don't build the housing, people won't come, take them on a tour of Los Angeles. Los Angeles is the "poster child" for how a lack of adequate new housing near employment centers can affect an economy.
4/1/2005
Rebound Markets Gain in Starts; Gain in Pricing
This month, we feature two markets that are on the rebound from housing downturns, Denver and Honolulu. Major Market: Denver Denver is one of our favorite markets in the country. In addition to being situated in the center of the country, the area boasts a high education level and an outstanding quality of life.
12/1/2004
Consumers Help Builders Reduce Risk
The remainder of the decade will bring dramatic changes to the home building landscape, particularly as it relates to consumer research.
10/19/2004
GIANTS Flock to Reno, Inland Empire Markets
Long-term housing demands holds in Riverside-San Bernardino, Calif., and Reno, Nev.
10/1/2004
Analyzing Housing Bubbles
With all the press on housing bubbles, I thought I would clarify a few things. In the past, the home building industry has been prone to two types of housing bubbles: 1) Price Bubbles and 2) Supply Bubbles.
8/23/2004
Land Risk and Returns Are Not Always Correlated
Theoretically, when land acquisition becomes riskier, executives should be requiring above average returns on their investments, and vice versa. Unfortunately, it appears that exactly the opposite is true.
8/10/2004
Rural Areas on the Rise in the East
It is not often that a rural area rises from obscurity to become one of the 50 largest housing markets in the country, but that is what is happening on the outskirts of Washington.
8/1/2004
Smart Decisions vs. Short-Sighted Accounting
As a business owner and former CPA, I know how important good bookkeeping is to running a business. However, it is frustrating to see some of my clients make short-sighted decisions because of project-based accounting.
7/12/2004
Capital Structures Determine Builder Strategies
All builders are not created equally. The capital structure of a builder usually dictates its strategy, including the types of land the builder prefers to acquire. I believe it will help builders accomplish their goals if they can explain to their inve...
6/7/2004
Manage Supply With Demand
Our advice: Let your consumers tell you where to buy land and what to build on it, and avoid the outskirts where new home competition is significant.
6/1/2004
Reducing Building Costs and Risks
Builders' purchasing departments are changing rapidly, and most contractors and consultants are not keeping pace with the changes.
4/6/2004
Tough Times to Continue in Dallas-Fort Worth
This month, we feature two dramatically different markets with almost identical home prices, Dallas-Fort Worth and Jacksonville, Fla. The Dallas-Fort Worth housing market is struggling with low demand and high supply, while demand and supply continue t...
4/1/2004
Risk vs. Reward
Today's successful building industry executives rely on people, processes and research to minimize the risk of making a mistake.
2/13/2004
Increase Your Market Knowledge
Understand and monitor housing market conditions to decide where to allocate resources and expand your business.
2/1/2004
Forecasted 2004 Sales Activity by Life Stage
While I cannot project total 2004 home sales with certainty, information is now available to understand the mix of home buyers in each price point in every market in the country.
1/20/2004
The Wealth Effect
Today's home buyers have more wealth and income than any generation before them. Where is all the money coming from? Here are 8 significant reasons why so many of today's home buyers have so much money.
11/12/2003
Parks Raise Revenue, Reduce Risks
The days of 'back-of-the-envelope' land deals and 'rule-of-thumb' land planning disappeared in the last decade, replaced by rigorous analysis with the goal of eking out every potential dime from very expensive dirt. Now, a new tool can help sharpen the...
10/1/2003
Change Is Constant
Strategic planning season is here, and that's always a great time to evaluate your firm. Have you created a culture that looks for and acts upon opportunities?
9/10/2003
Retirement Housing Forecast, Part 3: Design
Current and future retirees do not want a house built for old people. They want an easy-living home that an Olympic athlete would also enjoy, and their preferences will vary greatly based on their socioeconomic status and their values.
6/30/2003
The Retirement Housing Boom
While there are huge demographic, lifestyle and value differences among the 61 million people who belong to the Pre-Boomer and Early Boomer generations, they have shared some common experiences that have helped differentiate them from prior retirees.
6/1/2003
Retirement Housing Forecast, Part 2: Marketing
Two of the greatest challenges of building and selling retirement homes are applying the plethora of available marketing-oriented research to the specifics of your community, and designing an economically feasible community with homes that deserve sign...
5/23/2003
Retirement Housing Forecast, Part 1: Location
Although most builders have not ventured into the retirement housing arena, builders are going to find that older buyers will become major purchasers of new homes in urban, suburban and rural areas all over the country.
5/1/2003
War's Impact on Housing
While we are all hoping for a quick resolution to the Iraqi conflict, we also are wondering if our business strategies need to be adjusted because of the war.
4/1/2003
Does Size Really Matter?
For some reason our culture equates size with success.
4/1/2003
A Solution to Rising Mortgage Rates
How would home builders sell move-up homes if 90% of prospective buyers would have to give up an existing low-interest loan for a higher-interest loan? The answer is simple. Somebody needs to invent and promote a transferable mortgage that stays with b...
2/26/2003
Housing Cycle Outlook for 2003
Builders, product manufacturers and service providers all estimate home sales volume and home price appreciation when preparing business plans each year.
1/1/2003
2003 Outlook
2003 Outlook for builders in various metropolitan markets
1/1/2003
Improving Profits Through Charity Work
Corporate relationships with nonprofit organizations have deepened in the past few years, reflecting a new strategic approach to philanthropy.
11/26/2002
How Well Is Your Company Really Run?
Benchmarking can quickly determine what portion of your profits is the result of good operations versus a strong housing market.
10/23/2002
Are You Taking Full Advantage of Rising Prices and Declining Mortgage Rates?
The lengthy construction process produces one frequently overlooked benefit: the opportunity to profit from declining mortgage rates and rising prices during the construction process.
10/1/2002
Have You Checked Job Growth Lately?
Does job growth even matter any more? What happened to all those economists who started every conference with phrases like, 'As long as job growth exceeds building permits, our market will remain strong'?
9/3/2002
Underserved Ethnic Group Has Huge Profit Potential
A group that the home building industry has largely ignored needs 4.6 million for-sale housing units built during the next 20 years.
8/2/2002
The Housing Cycle Barometer™
Which markets are poised for rapid appreciation, and which are not.
6/26/2002
Fastest Growing Markets for Entry-Level Housing (33 year olds)
Fastest Growing Markets for Entry-Level Housing (33 year olds)
5/22/2002
Fastest Growing Market for Moveup Housing (43 year olds)
Fastest Growing Market for Moveup Housing (43 year olds)
5/22/2002
Major Changes in Housing Demand Are Only Two Years Away
Analysis of recently released census data will help you determine what types of new homes will be in greatest demand in your market over the next few years.
5/1/2002
Privacy Policy | PB Ad Info | PR Ad Info | CB Ad Info | GIANTS Ad Info | HZ Ad Info | Contact Us | Subscriptions
Copyright © 2009 Reed Business Information, A Division of Reed Elsevier, Inc.