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Can the Boom Continue?


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Question: will the price of homes go down? Or due to lack of inventory will they stay the same? I'm on the fence about buying soon, best to wait until 2017?

 

The price of housing very well may go down.  Anecdotally, houses seem to be staying on the market longer in my corner of the Heights, and we're certainly not seeing the rapidly rising prices that we were a couple years ago.

 

Whether to buy now?  That depends on how long you plan to stay there.  If it's less than 3 - 5 years, the economics of buying are pretty marginal anyway. 

 

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Question: will the price of homes go down? Or due to lack of inventory will they stay the same? I'm on the fence about buying soon, best to wait until 2017?

If oils goes to $33 and stays there for A couple of years, it's best to wait.

If oil has an improving price environment during 2015 and 2016,it's best to buy.

Everything in between is judgement.

Nobody knows.

Edited by UtterlyUrban
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If oils goes to $33 and stays there for A couple of years, it's best to wait.

If oil has an improving price environment during 2015 and 2016,it's best to buy.

Everything in between is judgement.

Nobody knows.

Summer is peak oil season. PEAK. If we are in the peak....

 

http://www.bloomberg.com/news/articles/2015-08-14/oil-s-worst-ever-summer-signals-price-rout-is-nowhere-near-done

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Things are about to get messy.

I think that's pretty obvious after seeing Schlumberger buy Cameron. My coworkers sister works at Cameron and there are many thousands of layoffs predicted with this... and for those that don't know, they are headquartered off 610. We'll absolutely see a lot of mergers soon to cut down on cost, and with mergers come layoffs. With layoffs........well......................

Edited by Triton
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how messy? for how long? Will I have to start stripping again?

Who knows but it's coming. Obviously Schlumberger / Cameron will have a big impact, COP alledgedly sent out pink slips today (heard up to 2k), and everyone like halycon, linn and the others who will get crushed when hedges start rolling.

But who knows - if the Saudis and Iranians have an all out proxy war in Yemen oil could go back up to $80 next month. But truth be told the oil patch stateside could probably benefit from some attrition.

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other than Medical, any other industries in town doing good?

I've noticed the job postings have simmered to almost nothing in Maritime, and if one comes up, there are 100's of applicants.

It has gotten pretty bad. Enough to where I am planning a move just in case it gets worse. I wish Houston would diversify more. Not fighting harder and smarter for companies like United or luring others in like Toyota is coming back to bite us in the ass.

My friends in Dallas and LA are posting photos of the falling gas prices on Facebook. One friend in Dallas posted a sign that had gas under two dollars. Most of the nation is very happy to see these falling prices and it is having positive effects in other parts of those area's economy. In Houston, it is almost bittersweet seeing falling prices.

Edited by Trae
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Could be good news.

Or a dead cat bounce.

We'll know with more certainly soon enough.

There's a lot of uncertainty in this world right now, economically speaking. Oil will probably be volatile for a while till the global markets get some firm ground to stand on. We don't know where China is going... where Iran is going... even where our own Fed is going. Either way, I just want it to stay at $60. It's a good balance... not too much for the consumer and the oil industry can breathe a little easier.

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There's a lot of uncertainty in this world right now, economically speaking. Oil will probably be volatile for a while till the global markets get some firm ground to stand on. We don't know where China is going... where Iran is going... even where our own Fed is going. Either way, I just want it to stay at $60. It's a good balance... not too much for the consumer and the oil industry can breathe a little easier.

Yep. And add to that a slowdown in the Eurozone, Venzuela in a bit of internal turmoil, countries like Nigeria very cash strapped, and Russia lurching.

We are in a hurricane. The outer bands have already hit us. Unfortunately, we don't know two crucial things: 1) how long will it last and 2) is it a Cat 5 or just a Cat 3?

Edited by UtterlyUrban
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Does anyone else think the Fed raising interest rates (or the widely held belief that they are finally going to raise rates) would provide the impetus for a boost in building short-term?

 

For anyone that would be financing, it seems to me an outlook of higher interest rates going forward would be a great incentive to doing the deal now rather than a year or two later when your cost to borrow that money would be higher. We're at the bottom as far as interest rates go, surely many folks hope to capitalize on that. 

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Does anyone else think the Fed raising interest rates (or the widely held belief that they are finally going to raise rates) would provide the impetus for a boost in building short-term?

 

For anyone that would be financing, it seems to me an outlook of higher interest rates going forward would be a great incentive to doing the deal now rather than a year or two later when your cost to borrow that money would be higher. We're at the bottom as far as interest rates go, surely many folks hope to capitalize on that. 

You can argue that's what the last boom was about. They've already taken advantage of the lower interest rates... raising interest rates won't help but hurt.

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I believe that there was two articles in the houston news today. One on Chevron and one on Connoco. Both said the same thing....... More lays off in houston coming for current employees and more contractors to be let go as well.

It's been about 6 months that oil has been down. Duration of the trough will be very important.

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40-50 projects not moving forward? Damn that pipe sure is full!

How many projects did we see come together in the last 2-3 years including what is under construction now? 40ish?

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  • 4 weeks later...

Just remember this is because of the war trade with Saudi Arabia.  They are now feeling the pinch.  What goes down always go up.  What goes up always goes down.  If they build this tower by the time it is done it will get leased.  It has a prime location.     

With a likely 20 percent vacancy rate city-wide after the last batch of office deliveries and Oil & Gas downsizing, have to think only certain niche markets can support new construction for the next 3 years minimum. Maybe this area is one where that could work, what other critical path could get something like this built right now?

 

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Just remember this is because of the war trade with Saudi Arabia. 

 

One reason there is a glut of oil is that no one is willing to cut production (although there are signs both sides are starting to give up)... and the TRUE reason there is a glut is that the world economy isn't doing well at all... almost all commodity prices are doing terribly right now. 

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What I wrote at the top of this page still holds true. The money has dried up. The investors and developers are going elsewhere

for now, and we're lucky we got out of this cycle all the wonderful things we did.

There will be medical construction around med center, and institutionaland education buildings, but office, multi family,

residential and most high end retail are done after Thor Equities project gets going. Unless the architecture firms here have a

lot of work outside Houston it will see cutbacks soon if not already. The port said their business is slowing due to the strong dollar and lack of need for oil and oil filed equipment worldwide. With China slowing its not helping with export import trade.

I know this sounds negative and cold but its whats coming.

Been there and done that.

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What I wrote at the top of this page still holds true. The money has dried up. The investors and developers are going elsewhere

for now, and we're lucky we got out of this cycle all the wonderful things we did.

There will be medical construction around med center, and institutionaland education buildings, but office, multi family,

residential and most high end retail are done after Thor Equities project gets going. Unless the architecture firms here have a

lot of work outside Houston it will see cutbacks soon if not already. The port said their business is slowing due to the strong dollar and lack of need for oil and oil filed equipment worldwide. With China slowing its not helping with export import trade.

I know this sounds negative and cold but its whats coming.

Been there and done that.

The port should have told you Chemicals are doing wonderful ;)
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The port should have told you Chemicals are doing wonderful ;)

The port told me nothing. This is from a story in the Chronicle business section either today or

yesterday. You are right though about Chemicals, but apparently not enough to make up the difference of

oil, steel and retail goods and because the dollar is so strong there not exporting as many goods as

normal. I don't like this any more than everyone else but sometimes you have to pay attention to all of

the signs and right now the signs say slow down.

This won't be quite as bad as the eighties because we don't also have a savings and loan crisis going on

at the same time, but it still has a huge effect on our local economy and anyone want to say it doesn't

well they live in a Poly-anna world. Unfortunately oil drives most everything in Houston.

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