Ep. 44 Carl Hudson – Did You Know the Federal Reserve Monitors Florida’s Real Estate Market?

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hudsoncarlpThe Federal Reserve is institution many are aware of. As the central bank of the United States, it serves as the standard for banking as well as regulates and moderates national interest rates. What many don’t know is that the Federal Reserve also has many other responsibilities.

Carl D. Hudson, Ph.D. is the Director of the Center for Real Estate Analytics at the Federal Reserve Bank Atlanta. The Atlanta division of the Fed (1 of 12) oversees much of the Southeast U.S., including Florida. Dr. Hudson is responsible for identifying and analyzing systemic impacts in real estate, economy, financial institutions and consumers. This week he shares his insights on the post-recession rates of Florida’s real estate market and its relation to the rest of the nation.

  • Florida is real estate market economy
  • Immigration major factor in FL real estate market
    • 2000-2007 – >300k/ year in population growth
    • 2008-2009 – <100k/ year
  • Economy is improving slowly
    • FL employment growth rates – 3.4% annually, highest in Southeast U.S.
    • Only .2% growth from pre-recession peak
  • Interest Rates may see increase over time
    • Short-term rate increases likely
    • Indicative of returning economy
    • No dramatic increases
  • Multi-Family markets in FL
    • 40% year-after-year construction growth rates
    • Major Markets: Tampa, Ft. Lauderdale, Miami, Jacksonville, Orlando seeing positive trends in construction
  • Miami
    • Largely driven by foreign market
    • July 2012: 4200 units under construction; June 2015 20,000 units under construction
    • Strengthening of U.S. dollar may inhibit foreign investment
  • Yield rates
    • Lower rates than pre-recession, but functioning at rates equivalent to early 2000s
  • Changes to investing
    • Prior to recession – financing investment involved a deposit
    • Post-recession – “pay as you go” financing on the rise
    • Greater commitment to investment, not easy to walk away
  • Growth trends for Florida?
    • Panama Canal reopening could mean major impacts on East Coast port cities
    • In FL – Jacksonville, Tampa, Miami, Ft. Lauderdale

To find out more from Dr. Hudson’s department, visit The Federal Reserve Bank of Atlanta’s website and click the Center for Real Estate Analytics link

Click here to read the President of the Atlanta Federal Reserve, Dennis Lockhart‘s speech on the national economy

Stay informed with Dr. Hudson’s blog, Real Estate Research

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