Friday, 30 September 2011

How Is The Economy REALLY Doing In Neighborhoods Around America?


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Recently we asked our readers if things were getting better or worse in their local economy.

Tons of people sent in replies, and as expected there was a wide variation.

Several wrote detailed report from North Carolina about a worsening housing market. Responses from the West Coast were mixed, with "new construction going up like crazy" in Los Angeles but "businesses pulling way back" in Seattle.

People agreed that the rich and the employed were fine, but the poor and the unemployed were getting desperate.

We rounded up the best comments, edited for clarity. Please feel free to leave additional comments below.

BURLINGTON, NC: Stagnant and getting worse

I live in Burlington, NC which is about a 45 minute drive west of Raleigh, NC and 20 minutes drive from Greensboro, NC along I-85/I-40.

The economy has been stagnant here for quite a while and I suspect that things may be getting somewhat worse.

Personally, I have been trying to sell townhomes in this area and have not received one offer in the two years and four months that they have been on the market despite repeatedly reducing the price by 40% from the original asking prices in May 2009. I realize that housing is slow all over the US.

My wife opened a retail furniture and accessories store in a nearby town where my family once operated a ladies hosiery business. It has been interesting to watch to ebbs and flows of consumer confidence since she opened. Although business has been decent the past two weeks, I wonder how the volatility in the investment markets over the past week will impact confidence in the coming weeks.

Earlier this year, we have been through two spells (in January and February and again in June and July) where we have had a lot of traffic but visitors had been viewing her store as a museum and really holding tight to their pocketbooks. There are a number of strip shopping centers with significant vacancies for a couple of years now, but I do not see much interest among retailers to take the plunge and move in.

Construction activity is severely depressed here. Most small business people that I speak with are just trying to hang on and muddle through as best they can.
It seems that nearly everyone is immersed in this balance sheet recession and no amount of easing in the credit markets is going to make a difference other than lead eventually to a serious bout of inflation following the approaching deflationary period that we are just now on the verge of entering. I think we are going to see a monumental scramble for liquidity on the part of all sectors of the economy - government, corporations and individuals.

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WILMINGTON, NC: Lots of underwater mortgages

I have only three neighbors. One auctioned off his house and had to come up with extra cash to pay off his mortgage.

Another neighbor, an architect of national repute, walked away from his house and his $1.1 million dollar mortgage.

My third neighbor, who inherited his wealth, stopped paying on his $1.9 million dollar mortgage over a year ago.

A wealthy family member cosigned on his mortgage, and will be hit with a monster deficiency judgment. That neighbor will stay in his house until he is forced out. The local bank is in no great hurry to piss off his family.

black swan on Sep 25, 7:11 PM

CHARLOTTE: NC: Empty homes and stalled construction

Here in the Charlotte area, what still stands out to me is the residential construction. There are hundreds of new neighborhoods that started in the boom time and they're still sitting there just like they were 3 or 4 years ago. Sometimes there's only one or two homes in them surrounded by tens/hundreds empty lots.

I drive by many homes that are empty; these are existing homes, not new construction. They're for sale, and they've been for sale for years now.

Real estate in this area just seems to be stopped in time with no sign of progress.

Charlotte NC on Sep 26, 1:41 PM

See the rest of the story at Business Insider

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