Posted on Wednesday, October 26, 2011
Economic numbers this week gave all of us a little boost – and confidence is what it is all about. The Naples real estate market enjoyed a significant decrease in inventories these past few months supporting a 15%+ increase in median prices over the last twelve months according to the Naples Board of Realtors – what would be great would be some increased confidence to support and grow volumes to keep this going and perhaps this week’s numbers may help. If confidence can build we think Naples real estate buying and selling volumes will increase right along with it.
By the numbers US GDP estimates now begin with a 2 instead of a 1. One per cent growth to me is concerning because we all have seen after the forecast adjustments close to that size – meaning 1% could well be 0%, flat, nadda, no growth, yuck. 2%+ is seemingly a small difference but we are more assured we are growing and growth is good, growth = jobs, confidence, profits, good stuff. Even interest on treasury bills came up a bit meaning people are probably leaving the safety of treasuries a bit in favor of other riskier investments – like stocks, commodities and Naples real estate. But most of all the numbers give us all confidence a recession is less likely and maybe we can start to invest again.
In our view confidence is what buys a home or invests in a property. Confidence is what gets cash off the shelf and into the economy. We will see if these economic numbers translate into confidence and then translate into increased real estate volumes in Naples.
Of course it can all turn on a dime and go south again, but the numbers this week are encouraging – we will see shortly in the next Naples Board of Realtors real estate report if confidence is turning into volume. We will keep you posted.
Tell us what you think – do you think confidence and volumes are building?