What Will The 2013 Economy Be?

Note: This is part 2 of a 2 part series looking back at the economics of 2012 and projecting the economics of 2013. Part 1 can be found here.  Also, look forward to the Triangle predictions coming up on Thursday.

With the year ending and all the talk about the “fiscal cliff”, there has been a lot of talk of what will happen during the next 12 months.  I feel like everyone can agree that the economy has seen better days and there seems to be indications that things are getting better.  Here is what I think the economy will be doing over the next 12 months.  Now as I stated last year, I am not by any mean the Oracle at Delphi, but this is my opinion based on a lot of reading and research by experts in their areas of expertise. Here are some areas of interest, including some not specifically discussed in Part 1 of this blog.

What Was The 2012 Economy?

Note: This is part 1 of a 2 part series looking back at the economics of 2012 and looking projecting the economics of 2013. Part 2 will be released on Monday.

Last year I wrote two blogs about what happened in 2011 and provided some projections for 2012.  I got a fair amount of feedback from those post so I figured I do it again this year.  I started last year’s blog with Sir Winston Churchill’s quoted of  “Those who fail to learn from history are doomed to repeat it.”  I continue to believe that this is true in every facet of life, including business.  This information is based on factual information.  There are no politics, no opinions.  It is what it is.  The purpose is to understand what happen in 2012 to set the stage for 2013.

Homebuilding In The News

It’s been a while since I wrote a blog about the home building and residential real estate. It has been three months since I even mentioned the industry in this blog and over seven months since I talked about the economic conditions of the market, locally or nationally.

Although it has been some time, I have not been ignoring the market. I have recently had discussion with those employed by builders, big and small, as well as a investor interested in a local large project. Also, over the past 10 days, I have seen a number of articles and news stories about the industry. So, I figured I let you all know about some of the news and provide an overview.

Raleigh’s Future Looks Bright

You would think we would get used to it.  “Get used to what?” you may ask.  Well I am not referring to the 100+ degree heat that the city will be experiencing for the five days.  It is to another Top 10 or Top 15 ranking by some outside organization looking in.  This time AOL Real Estate included Raleigh in its listing of 15 Cities Where The Future Looks Bright.  Why?  Jobs, jobs, and more jobs.

The State of Downtown Raleigh

Want to get nearly 300 business people, executives, and politicians in one place on a Wednesday morning?  Do an official “State of the Union” type forum and invite a Senior Director from a tech savvy company,an Executive VP, for a large hospitality group, and a newly appointed Economic Development Manager.

Well, that is exactly what happened yesterday at Downtown Raleigh 2012: An Economic Forum held by Downtown Raleigh Alliance.

Economic, Construction, and Real Estate News

We have had a lot of economic, construction and real estate related news in the past few days.  Instead of looking at just one of them in a vacuum, I am going to highlight many of them.

• Nationally, consumer sentiment rose to 70.8 in February from 61.5 in January, achieving a sizable improvement. Consumers’ expectations rose to 88.0 from 76.7, while their views on current conditions increased to 45.0 from 38.8.  See the full story here.
• Warren Buffett says along with equities, single-family homes are a very attractive investment right now, based on a CNBC interview.  He believes that the market is getting back into a situation that if the homes are held for a long period of time and purchased at low rates, the houses are even better than stocks.
• An article in the Triangle Business Journal states that economic activity appears to be picking up across North Carolina, with fewer people filing first-time claims for state jobless benefits and forecasters predicting a bounce in new housing starts by 2013.

There have been a number of stories in the past several days about the local construction and real estate industries.  Some of it was good and some of it was not.

• One of the negative stories was the report on the change of the Triangle’s construction industry employment figures.  I feel like we all logically knew this.  However, the numbers show that the Triangle peaked in December 2007 when payrolls were hitting 40,400. Then came the contraction.  By December 2011, according to Virginia-based Associated General Contractors of America, Triangle payrolls had dropped 30 percent to 35,300.  (Check out the full article here).
• California-based commercial real estate firm Grubb & Ellis filed for bankruptcy.  Grubb & Ellis does have an affiliate in the Triangle.  It appears that Grubb & Ellis will be bought by New York-based BCG Partners Inc. as part of the Chapter 11 bankruptcy process.  There is no news of how this will affect the local affiliate.
• The residential market update for 2011 from Birch Appraisal Group was released showing 2011 average prices and percent to assessed value by jurisdiction for Wake County.  Cary had the highest average price and Apex had the highest percentage.  Garner came in with the lowest in both categories.
• Preston Development looking at 7,108 acres for Chatham Park, a masterplanned community that mixes the golf course and executive homes of Prestonwood and business hubs of Research Triangle Park.  The idea is to essentially develop a RTP 2.0.

–J. Nolfo helps companies understand their market and customers though a variety of market research strategies. He has over ten years of experience of market research for strategic planning purposes. He is the Director of Research at Rhino Market Research. He shares his thoughts about market research and business concepts with his blog “Pensare…Understanding Market Research in Business“. If you would like to discuss this blog or how J. can help you understand your market and customer needs, email him at jnolfo@rhinomarketresearch.com.

Keeping Yourself Knowledgeable

I was recently speaking with a group of job seekers and the question was asked about how to keeping skills up to date.

What was first discussed was why people needed to do something proactive about using their skills. But as I recollect the conversation, this is really true for everyone, regardless of their employment situation.

A lot of great ideas came up. And although I could have listed them here, instead here are some of the ones that were discussed with further insight.

Reading

Now some people can sit and read books like no tomorrow. I do not have this skill and have tried to improve upon it over the past year and a half. However, here I am talking about reading magazines, articles, websites and blogs about your industry (or potential industry), your job type, and the economy. Notice I said “and”. By doing all three, you are keeping up to date with all the issues that are affecting you and your company. You will also get an insight into trends you may not be aware of and be able to leverage them in your workplace or job search.

Blogging

OK, first I am biased. I have put out two blogs per week since last October. I know that is only about five months. But by doing so, I have opened my eyes to new ideas in the various industries I work in, continuous analysis into the economics of the market, and understanding a number of areas I would have never explored into great depth, including social media.

Volunteering

Volunteering is good for the soul. Find an organization that you want to commit to. It will fulfill your life. This country was based on the idea of charity to others. Those that can help should and when they can. This is not a political thing. If everyone volunteered just a little bit, not only would you feel good, but our country and those you help would be better and stronger. (Now stepping down from the soapbox.) Now, for those in the job search, try to find out how that organization that can utilize your professional skills. Even if it seems like some trivial way, it would be a great help to them and an even better way to keep your skills sharp.

Taking classes

You should never stop learning. Now there are a variety of classes where you can improve your skills or learn new ones. We here in the Triangle have the ability to take a variety of classes. If you are looking for work, you can check out the Human Resource Development, or HRD, classes at Wake Tech. The fee is waived for those that are unemployed or underemployed. If you are working, the price is negligible. However, there are a number of other opportunities to learn. I am currently in a 2-day “class” about improving my business.

Although this is not an exhaustive list of the things you can do to keep your skills sharp, they seem to be ones that seem to be the most effective for everyone, regardless of your employment situation.

What are some of the things you do to keep up your skill set sharp?

–J. Nolfo helps companies understand their market and customers though a variety of market research strategies. He has over ten years of experience of market research for strategic planning purposes. He is the Director of Research at Rhino Market Research. He shares his thoughts about market research and business concepts with his blog “Pensare…Understanding Market Research in Business“. If you would like to discuss this blog or how J. can help you understand your market and customer needs, email him at jnolfo@rhinomarketresearch.com.

Big Happenings In Raleigh!

This is an exciting week in Raleigh! You may just not know it!

For those reading this that live in the Triangle, we know that Raleigh tops the list of multiple “Top Ten” type list. (You can see the latest news and list here.) However, you might not of some of the events this week designed to help enhance Raleigh.

On Wednesday evening, the first “Innovation Meet Up” was held. This meet-up is designed for people who want to share their ideas on innovation in Raleigh and learn more about action items and ideas generated at the Innovation Summit that was held on January 18, 2012. The Raleigh Innovation Summit was designed to create a unified vision for the City’s innovation and entrepreneurship initiatives. The discussion topics included:

• Creating an Innovation Center in Raleigh
• Branding Raleigh as a City of Innovation
• Creating Public/Private/University Partnerships
• Attracting more funding to the region

You can continue to follow the discussions on this by going to their website or following #InnovateRAL on Twitter.

Ignite Raleigh 3is being held on Thursday evening at the Lincoln Theater. Ignite events were originally conceived as technology variety shows, but they have grown into much more than that. Ignite is about ideas. Ideas can change the world. And it takes less than five minutes to spread one. Each presenter gets five minutes on stage with 20 slides that rotate automatically after 15 seconds. You can continue to follow the discussions on this by going to their website or following @IgniteRaleigh on Twitter.

Innovation and Ideas are just not the new buzz words but needs to be focused on how we grow the local marketplace and economy. These two events are just the begining of further improvement and great growth.

What are some ways you have seen Raleigh (and the Triangle) grow and what would you like to see?

–J. Nolfo helps companies understand their market and customers though a variety of market research strategies. He has over ten years of experience of market research for strategic planning purposes. He is the Director of Research at Rhino Market Research. He shares his thoughts about market research and business concepts with his blog “Pensare…Understanding Market Research in Business“. If you would like to discuss this blog or how J. can help you understand your market and customer needs, email him at jnolfo@rhinomarketresearch.com.

Residential Construction In The News

All week long, there has been a number of stories on the evening news and in various newspapers about residential construction and real estate in the Triangle region. I feel like last weeks article from Inman News was a catalyst for all of this. But since the beginning of the month, there have been several other newsworthy events about real estate in the nation and the Triangle. Here is a list of them.

• Associated Press article stating that the CEOs of some of the biggest homebuilders feel the housing market has stabilized.
• Discussion and stories at this week’s International Builders’ Show in Orlando about most local markets improving in 2012.
• NBC-17 story about buyers flocking to buy homes in areas with retail nearby.
• Triangle Business Journal article about Mountain Real Estate Capital of Charlotte buying ownership of Brightleaf in Durham.

Although not directly housing related, you need to include in the mix these stories.

• Raleigh added 8,700 new jobs last year (TBJ article)
• National jobless claims drop
• January’s national unemployment rate of 8.3%(left up to interpretation, see this article).

So what does all this mean? Well, by crystal ball was recently cracked and the store I bought my last one is out of business (Shouldn’t they have seen that coming?). The real answer is “who knows” There seems to be a lot of optimism for 2012; not that there isn’t at the beginning of every other year. But the people I talk to have a good gut feel about the next 11 months. Obviously, we will not know until then, but the positive attitude certainly cannot hurt.

So…What do you think this all means?

–J. Nolfo helps companies understand their market and customers though a variety of market research strategies. He has over ten years of experience of market research for strategic planning purposes. He is the Director of Research at Rhino Market Research. He shares his thoughts about market research and business concepts with his blog “Pensare…Understanding Market Research in Business“. If you would like to discuss this blog or how J. can help you understand your market and customer needs, email him at jnolfo@rhinomarketresearch.com.

Good News On Raleigh Housing Market

Oops, we did it again! But in a good way!

Again, Raleigh-Cary has topped a national list. This time it is from Inman News, a leading source of independent real estate news, information, advice, research, opinion and commentary for industry professionals and consumers alike. Inman looked at the Top 10 Real Estate Markets to Watch In 2012 (You can look at the full article and list here). The markets were evaluated on a number of key metrics, including above-average price appreciation, a flourishing job market, a high rate of sales in proportion to population, a high level of home affordability, low foreclosure activity, a below-average share of distressed sales, a low vacancy rate, and other characteristics indicating a healthy housing market.

In last years survey 8 of the 10 were in the Midwest and Raleigh was not even on the list. This year, the South and the Midwest dominate the listing. The listing in order is

1. Raleigh-Cary, N.C.
2. Wichita, Kan.
3. Rochester, N.Y.
4. Des Moines-West Des Moines, Iowa*
5. Chattanooga, Tenn.-Ga.
6. Peoria, Ill.
7. Amarillo, Texas
8. Binghamton, N.Y.
9. Waterloo-Cedar Falls, Iowa
10. Bloomington-Normal, Ill.*

The Des Moines and Bloomington-Normal metros are on the list for the second year in a row. There were some changes in the methodology from last year by requiring a minimum metro population.

The Raleigh area is used to being at the top, or near the top of many national lists. This will continue to attract good employers and jobs to the area. We want to be here for these purposes.

–J. Nolfo helps companies understand their market and customers though a variety of market research strategies. He has over ten years of experience of market research for strategic planning purposes. He is the Director of Research at Rhino Market Research. He shares his thoughts about market research and business concepts with his blog “Pensare…Understanding Market Research in Business“. If you would like to discuss this blog or how J. can help you understand your market and customer needs, email him at jnolfo@rhinomarketresearch.com.