Friday in Charlotte| Ramblings on Charlotte News and Real Estate From the Week…

November 21st, 2008 Categories: Charlotte Business, Charlotte News and Politics, Real Estate News

Terry McDonald Blogger/Broker Charlotte Communites Online Charlotte, NC We are getting January type weather in November and I for one have had a enough of these 50 degree high days. Supposed to stay cool through the weekend…

The big local Charlotte news is that the state of North Carolina is asking the school systems for money back-

they are expecting severe year end shortfalls and are asking school systems to return some of their annual allotment. They are asking each school district to return $39/student, for CMS- over $5M. CMS Superintendent Peter Gorman is looking for non-teaching cuts. I’ve heard in the Washington DC area they are talking massive teacher layoffs to meet their larger budge shortfalls… and they’ll just go with larger classes.

Charlotte Country Day School- one of the area’s premier private schools announced that Mark Reed, assistant headmaster at St. John’s School in Houston, will take over as Charlotte Country Day’s head of school on July 1. Considered a rising star in private education circles, Reed will be the first African-American at the helm of a private school in Charlotte.

NC Treasurer Moore has called the Wells-Wachovia deal a bad deal for Wachovia

stockholders and North Carolina, and is looking at ways to block it. Wachovia Chairman Bob Steel responded this week saying the Wells deal is “good for Wachovia, and was the best available.” What was the urgency that weekend to strike a deal? First it was Citi, then Wells later in the week? The FDIC told them they weren’t going to allow the doors of Wachovia banks to open that Monday without a deal. More. Well that explains the deal…

In other banking news, and Charlotte commercial real estate scuttlebut, GMAC is said to be considering relocating their headquarters here (Ballantyne) to take advantage of some of the financial workers expected ot be available in the spring.

Fundraising for the UNCC (University of North Carolina Charlotte) Real Estate Center surpassed its goal of $4 Million raising 4.4M dollars for thenew Real Estate Center. UNCC is the 4th largest campus (of 17) in the North Carolina system and has over 22,000 undergraduates and 5000 graduate students. It is the largest University in the Charlotte area.

———————-

National Economic Notes…

A sign that the tide is turning? Septemeber home sales are UP 66% in Southern California over last September as median home prices fell to $300,000, 2003 prices, very affordable by west coast standards. Unbelievable? I thought so too, here is the link for the skeptical. from the WSJ.

Fannie and Freddie announced they were postponing foreclosure actions on 16000 homes until January 9th, as they review their eligibility for a new workout plan. Holiday relief for a few. The debate is raging about whether these should be made public companies or remain government entities- the NAR says keep them in government hands. Socialists!

Citibank’s stock price fell dramatically this week- why? They still own, and are liable for, a whole mess of “credit-default swaps”, this quasi-insurance type product Warren Buffet called a “weapon of mass financial destruction” in 2003. Essentially, companies paid a premium, say $100M to Citibank, and Citibank would guarantee ten billion dollars of the securitized mortgages. They worked just fine with rising house prices, easy $100M. Can anyone say, oops?
worried man In Nevada, nearly 1/2 the homeowners owe more than their house is worth. Notice how many of the cities are California cities? This was the mess Wachovia bought into in 2006 with thir $24B purchase of “Golden” West- a huge writer of the pic-your-payment mortgage loan.

New home construction and new home permit requests fell to a 50 year low in September. This is good news for everyone NOT associated with the building industry… we need to STOP adding inventory. Apparently the Tresaury Department is considering a ban on new construction as well. From the WSJ.

Experts are debating but many believe that the economy can’t turn around until housing bottoms out. So should we stop building new?

Above My Pay Grade

These are the questions on my mind as I ponder the big picture…

Can the US remain a superpower without a US auto industry? If we were at war, can the Secretary of Defense call The chairman of Toyota and tell him we need more armored vehicles? In a hurry?

How do we get out of the mortgage mess- investors were sold these securitized products, guaranteeing their returns through the credit default swap. (I’m no expert here so if this isn’t right, speak up, glad to fix it) These “guarantees” can easily put the banking business, out of business, see AIG and more recently the damage to Citi shares. So far, all the support given, over 300 Billion dollars, it amounts to no more than filling 300 holes in the colander, with another 2000 still leaking cash. Until the underlying asset- the mortgage - is fixed, our financial system is in jeopardy. Would Secretary Paulson agree?

———————————-

Moving to Charlotte? Your first Charlotte home?

Have a home buying or home selling questions? I am a Charlotte real estate broker specializing in relocations, 2nd homes–buying and selling real estate of all kinds- and will represent only you. We work with Buyers and Sellers every day in Myers Park, Southpark, Matthews and Huntersville, Lake Norman, Waxhaw and Lake Wylie too. My team and I know the homes, the communities, and the new home builders. We know what’s hot, what’s not and where the deals are. I think as you read my posts you’ll see that we understand home buyer needs, from a first time home owner to a luxury home purchaser.

If you still haven’t figured out where you might want to live in Charlotte, you may compare area Charlotte home prices and communities, from our MLS based home search below. If you havenb’t already, try my my fact-filled and well received Introduction to Charlotte NC Video (over 9000 You Tube views) and don’t miss the FAQ videos-answering the Big Question- Where to live in Charlote, or where to look for a luxury home in Charlotte? (in the right column just under the Introduction to Charlotte Video Screen)

If it’s between the hours of 8 AM to 8 PM, EDT, please don’ t hesitate to call me direct at 704-351-1519. Terry