New home sales are on the rise but the existing home sales are keeping up. According to the National Association of Realtors (NAR) total existing home sales reported a seasonally adjusted annual rate of 5.42 million.

The NAR reported that on a year-over-year basis, existing home sales were 0.6% up than a year ago which included single-family homes, townhomes, condominiums and co-ops. This is the first year-over-year gain in almost a year and a half.

Homes stayed on the market 29 days in July 2019 with 51% of homes on the market selling in less than a month. All-cash sales composed 19% of transactions up from June 2019. Median sale price of existing homes in July was up 4.3% from a year ago at $280,000 and existing condominium/co-op prices were up 2.5% with a median price of $254,300.

Sales by regions saw an increase, except for the Northeast and West, for existing homes sales in July 2019. Existing home sales in the Midwest grew 0.8% and in the South existing homes rose to 2.7%.

NAR has encouraged the market to add more inventory which is a good sign. The falling mortgage rates, July 2019 at 3.77%, and lower home prices are a big plus.

“We are optimistic that the latter part of this year and the early months of 2020, at least, will see a significant upturn in sales. That, in turn, will boost construction activity in due course,” wrote Ian Shepherdson, founder and chief economist of Pantheon Macroeconomics, in a research note.

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Most Americans are affected by interest rates whether through a mortgage or credit cards. July 2019, marked the first time the Federal Reserve lowered interest rates since the crash in 2008. Pressured by President Trump and the possibility of an economic downturn, policymakers voted 8-2 for the small cut in federal rates.

“Should trade negotiations turn positive and economic data, especially inflation, firm in coming months, July’s move could be a one-and-done easing,” said nationwide senior economist Ben Ayers in a note. “Still, given the slowing trajectory for the economy and precedence from previous mid-expansion easing cycles, a further rate cut (or two) by year-end may occur.”

Investors are eager to see the out turn of the rate cut and are hoping for more rate cuts in the near future. They are watching for any clues that there will be a future rate cut. Wall Street has already been pricing another rate cut for the year end.

The economy is strong as seen in job gains and retail and economic growth on the rise. If there is another cut, the Federal Reserve will need to justify their decision.

Policymakers vocalized that they will “continue to monitor” any data which would have an effect on the US economy and “act as appropriate” to retain “the country’s longest economic expansion in history.” The central bank believes these steps are necessary to keep America’s economy strong.

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This year the housing industry has been on an uphill victory. According to NAHB Chief Economist Robert Dietz newsletter, Eye on the Economy, there are two main factors that are helping the single-family housing sector.

Job growth has been on a positive path in 2019. It is reported that there is a historically low unemployment rate at 3.7%. In June 2019 there were 224,000 jobs added to the country’s workforce. The first six month of the year saw an average of 172,000 new jobs per month.

In the residential construction industry alone the increase was 21,000 jobs in June. The average for the first six month of the year in residential construction stands at 5,800 per month. Since the recession, there have been a total of 923,800 positions added in residential construction.

Also to aid in the booming housing industry is lower mortgage rates. Freddie Mac reports that the averaging 30-year fixed-rate is 3.8%. This is the fifth straight month that mortgage rates have fallen making this one of the best times to finance a home.

A recent industry survey shows that the mortgage loan applications for both purchase and refinance surged in the first week of June 2019.

In the most recent survey put out by the Freddie Mac’s research team it states that this “will help sustain the momentum in the housing market in 2019.”

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La Provence was one of north shore’s dining landmarks until it closed in 2018. What was once a French restaurant, will now open as a hotel and events venue. The spot is perfect for this as it has been compared in the past to a classic French country inn.

Cayman and Danny Sinclair, brothers and local entrepreneurs, purchased the property which they plan to turn into the small hotel and events venue naming it the Inn at La Provence.

“I feel like there’s so much value in that name, it’s so recognized; it means a lot to people. It would be a shame to lose that,” said Cayman Sinclair.

The single-story building currently has several dining rooms and a “lodge-like lounge” with a fireplace. La Provence, which was built and opened by Chris Kerageorgiou in 1972, became one of the north shore’s most respected restaurants. Well known for Kerageorgiou’s quail gumbo and braised rabbit, his lamb a la Grecque and the little pots of chicken liver pâté set down with the bread, La Provence gave residents a great place to create fond memories.

“My family would stay for hours, sitting around that fire in the front room,” he said. “It was a classic place. We’re really excited to be able to revitalize it.”

The brothers plan will be to reconfigure the existing building for the events venue and build small bungalow-style structures on the two-acre property. The 28 room hotel and events venue would be a perfect place for weddings, corporate meetings and retreats.

“We can host the event, they can stay on the property, and from here they can go to other restaurants for rehearsal dinners or their night out,” he said.

Set to open in Fall of 2019, the Inn at La Provence will also open to the public for brunch on Sundays.

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Liz’s Where Y’ at Diner in Mandeville was tragically burned in a fire June 11, 2019. The closing of this landmark at 2500 Florida Street was sad for everyone. Liz is not letting the fire detour her business. She plans to reopen.

Tuesday morning, June 11, 2019, a fire broke out during a busy morning rush. The fire began in the dry goods storage area and spread from there causing major damage to the building. The restaurant’s 10 year anniversary is today and will be celebrated when the restoration is complete.

Liz praised the community for their love and support, “The love we’re getting … the wonderful things people are saying and doing for us. The free meals (from neighboring restaurants). It’s amazing. It’s truly amazing.

“I’ll tell you: It’s overwhelming.”

Liz Munson opened “the laid-back diner” ten years ago in Mandeville on Florida Street. This had been her dream after waitressing for fifteen years. The New Orleans native wanted to celebrate the New Orleans’ classic Creole food in the tranquil setting of the Northshore.        

The fire hasn’t stopped her from working nor her employees. She will keep paying her employees even though the restaurant is closed. Liz has created a make shift office out of a picnic table next door. She and her 33 employees are working on getting the restaurant restored and reopened.

Luckily the damage was mostly in the kitchen area, however everything will have to be replaced. Munson explains that, “The smoke (damage) is everywhere. Little things like the pencils and the pens. Every sheet of paper. Everything smells like smoke.”

Patrons will still enjoy the same food, and same atmosphere as before. Liz shoots for a Labor Day reopening. There is a GoFundMe page that has been set up to help cover cost.

Click here to contribute to the GoFundMe account for Liz’s Where Y’ at Diner.

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Baby Boomers have been a big target in the housing market but the future will see a shift in who the future housing market will capture. According to Morgan Stanley, Millennials and Gen Z will slowly take over.

In 2019, it is reported that Millenials (those born between 1981 and 1996) will become the largest generation in the nation. If all follows as planned, Gen Z (those born between 1997 and 2012) will take over in 2034. What does these mean for the housing market? This “youth boom” which is the merging of these two generations will heighten the economy and encourage a drive for demand in housing.

“We’re going to see strong demand for housing, both multifamily and single family, over the medium to long term,“ says Richard Hill, who leads Morgan Stanley’s U.S. REIT Equity and Commercial Real Estate Debt research teams.

We can already see the effects in the housing market in many U.S. regions. Areas report bidding wars as the Millennials a forming households. Home prices across the country continue to rise due to the lack in inventory. There are a reported 22 million people between the ages of 20 and 24 across the United States that will be adding 3.6 million new households within the next five years.

“Our findings show that household formation will increase 1.7 times annually over the next five years, compared with the prior eight years,” says James Egan, a strategist on the firm’s Securitized Products Strategy team.

The areas with the change in the trend market are definitely effected in different ways. The West and Southwest are seeing a rapid change because the Millenials outnumber the Baby Boomers. This is the exact opposite for New England and the Rust Belt which have the least Millenial population.

With a new generation comes a new way of buying, iBuyers. An iBuyer is a company that uses a web-based questionnaire and home-value algorithms to purchase homes. Basically they use technology to make an offer on your home instantly. iBuyers will account for 3% of the U.S. existing home sales by 2030.

“3% might seem small in percentage terms,” says Brian Nowak, Head of U.S. Internet Research, “But given the large size of the residential market, which is around six million transactions a year and $1.8 trillion in transaction value, it means iBuyers would purchase roughly 175,000 homes in 2030.”

The U.S. housing market will see a massive change in both target market and purchasing tools within the next decade. This is great news for both single-family homes and multi-family homes.

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Spring is not the only thing warming up this year, the National Association of Realtors (NAR) just reported that the pending home-sales rose 3.8% in March 2019 (April 2019 will be released May 30, 2019.)

“There is a pent-up demand in the market, and we should see a better performing market in the coming quarters and years,” said Lawrence Yun, NAR’s chief economist.

The Pending Home Sales Index reported its findings based on a forward-looking indicator of the contract signings which rose to 105.8 in March from 101.9 in February. Yun notes that the increase has been influenced by the influx of mortgage applications and favorable mortgage rates.

The break down by region is contrasting. In the Northeast there has been a decline in pending sales of 1.7% in March to 90.5. In the Midwest however, pending home sales grew 2.3% to 95.3 in March. The two regions with the biggest jump in March were the South which rose to 127.2 (a 4.4% jump) and in the West to 95.1 an 8.7% rise.

So far spring is looking up for the housing market and only time will tell if the selling season will remain a hot market.

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St. Tammany Parish school system has 55 school campuses with 39,000 students. The school system takes no cuts when it comes to safety. Currently there are 1,793 security cameras in schools and buses, perimeter fencing around all campuses, and visitor photo id systems in place at each school. This month St. Tammany Parish voters approved referendums “to pay for police officers and mental health providers on public school campuses.”

The new property tax, which 64% of voters supported, gives the school system money annually allotted from the new 2-mill tax. The money will pay for police officers and mental health providers at each school campus. Luckily the 2 mills will not cost St. Tammany homeowners additional tax money due to the School Board decision to cut 2 mills from the district’s tax rate.

Other outcomes of the May 4, 2019 voting were also positive. Sixty-five percent of the voters agreed to allow $175 million in bonds to go to St. Tammany schools for construction and technology purposes. Covington elected Mark Verret as the final member of the City Council. There was also a 10-mill, 10-year property tax for Lacombe area recreation renewed as well as a 5-mill, 10-year tax for the Pearl River fire district.

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Madisonville, Louisiana is rich in boat and ship building history. In fact, the U.S. Navy built their vessels and repaired them in Madisonville during the War of 1812. Today plans were announced to reopen an unoccupied barge manufacturing plant on the Tchefuncte River in Madisonville.

The 230-acre plant was the home to a Trinity barge-manufacturing plant which closed its doors in 2015 when Trinity Marine Products announced the “demand for larger tank barges that transport oil is currently soft.”

“Due to encouraging conditions in the barge construction market, we are pleased that Arcosa Marine is restoring the Madisonville barge facility to full operation,” Arcosa Marine president Thomas Faherty said. “Arcosa Marine is preparing the facility to produce barges for customer delivery in 2019.”

Arcosa Marine Inc. will begin a $7.5 million renovation on the project and will hire approximately 149 employees. Gov. John Bel Edwards said the state will give them an incentive package that will include a workforce training program and Arcosa will also use the state’s Quality Jobs and Industrial Tax Exemption programs. They plan to install new equipment and upgrade the plant in order to produce barges.

“We are excited to welcome back the manufacturing operations of a marine mainstay in the St. Tammany Parish economy,” Edwards said in the news release. “Manufacturing jobs generate great economic activity and a high number of supporting jobs throughout the area. We’re encouraged by the return of barge manufacturing in Madisonville and hope that this new investment by Arcosa will lead to greater growth in the future.”

This is a great boost for the St. Tammany area economy. There will be an additional 236 indirect jobs for the region. The average annual salary for new jobs will be $51,400 plus benefits.

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