On March 21, 1918 the German army launched its massive offensive against the British and French. With 500,000 troops from the Russian front, freed by the treaty with the new Bolshevik government, Germany intended to land a knockout punch against France, capture Paris, and win World War I.
German artillery fired a million shells against the front in just the first 3 hours. German troops advanced rapidly and the German commander was able to get his enormous field guns close enough to begin shelling Paris itself.
But French resistance stiffened, and held once again at the Marne River. German troops outran their supply lines and were so hungry that they stopped advancing to ransack the huge food supplies in the town of Albert. The attack planned by the Germans to take the important city of Amiens was stalled. And, much to the German commander Ludendorf's dismay, 250,000 American troops had arrived to replenish the French and British forces exhausted by nearly 4 years of bloodletting.
At Belleau Wood, the Americans withstood a furious German assault and saved a key point in the allied line from being overrun. And at the Marne, the American 3rd Infantry division stood alongside the French and stopped the main German offensive in its tracks. Today, if you visit Fort Stewart you will see the nickname given by French commanders to the unit, "Rock of the Marne".
After the failure of the German offensive, the allies launched their own offensive and drove Germans back consistently until on the 11th day of the 11th month, 1918, the guns fell silent.
Saturday, March 21, 2015
Monday, March 9, 2015
Rental Market Still Strong
The Rental Market still presents rising rents and low vacancy to those seeking apartment living. Even though about a quarter million new units were delivered in 2014, rents continue to rise and vacancy remains around 5%. 2015 is projected to add another 250,000 new apartment units to the US market, with especially high deliveries in the Texas markets
So what's keeping the pressure on rates and vacancies? Demand - from young folks that move out of parents homes, from boomers downsizing and prefer rentals, and pent up demand from job seekers now able to form households. The creation of new households will outstrip even aggressive building of new units and will continue absorb the single family home rentals available. Investors are committing enough new money to demonstrate their long term optimism on the rental market.
In some cities affordability drives people to rent, even where average rents are high. Two notable examples are New York and San Francisco where monthly rent above $3000 is still half what a mortgage payment could be. Further, that is generally true of the west coast and the Washington DC to Boston corridor, with some exceptions.
So what's keeping the pressure on rates and vacancies? Demand - from young folks that move out of parents homes, from boomers downsizing and prefer rentals, and pent up demand from job seekers now able to form households. The creation of new households will outstrip even aggressive building of new units and will continue absorb the single family home rentals available. Investors are committing enough new money to demonstrate their long term optimism on the rental market.
In some cities affordability drives people to rent, even where average rents are high. Two notable examples are New York and San Francisco where monthly rent above $3000 is still half what a mortgage payment could be. Further, that is generally true of the west coast and the Washington DC to Boston corridor, with some exceptions.
Tuesday, June 24, 2014
New Inventory Coming Online
Well the apartment industry is finally catching up to the expansion of rental households. Many thousands of properties are coming online in major cities, and that should take the edge off of the continuous rise in rental costs. Units coming online offer very fine finishes and amenities plus workout rooms and plush social commons. Although the slow down in the demand/supply ratio will help, pressure from normally first-time home buyers opting to rent, and boomers trading (disappointing) home ownership for the freedom of renting mean that prices will slow but not stabilize.
The multi-family housing industry is also tackling the eruption of demand in oil fracking - usually remote - towns, especially in North Dakota. Development has accelerated as the activity (boom!) drives more and more workers to small towns in northwest North Dakota and eastern Montana, plus the Ohio/PA border area.
New York just defies all the odds as average rental costs approach $4000 per month. And that's for a smallish unit with ordinary amenities. It's still expensive just to get the apartment with broker fees at about 15% of the annual rental expenditure. Still, it is New York and one of the world's great mega-cities!
The multi-family housing industry is also tackling the eruption of demand in oil fracking - usually remote - towns, especially in North Dakota. Development has accelerated as the activity (boom!) drives more and more workers to small towns in northwest North Dakota and eastern Montana, plus the Ohio/PA border area.
New York just defies all the odds as average rental costs approach $4000 per month. And that's for a smallish unit with ordinary amenities. It's still expensive just to get the apartment with broker fees at about 15% of the annual rental expenditure. Still, it is New York and one of the world's great mega-cities!
Tuesday, June 18, 2013
Rental Market Tightens Even Further
It will be no surprise to most that the rental market continues to experience very low vacancy, and very high occupancy rates in the current market cycle. Our many sources indicate a broad continuation of this trend. Those seeking rentals, especially in higher end properties, should expect to see available units rented quickly. Those who plan ahead and maintain close contact with providers will have more and better options, and can act quickly when time is of the essence.
Axiometrics forecasts U.S. apartment occupancy to reach 94.9% by the end of 2013, and effective rent growth to measure 3.6%. The occupancy forecast is 0.6% above the 2012 rate but the rent growth forecast is 0.2% below the 2012 rate. Why? Because more supply is coming into the rental market through both new building and continued growth of REO to Rental homes.
Our research has identified a clear correlation between file notice and results. An increase of only a few days in the amount of time between the initiation to the supplier and the tour date can increase rental placements by 30%. Conversely, an urgent (as opposed to “rush”) file presents a far higher chance that an assignee will have a less than excellent experience. So don't let those rental files accumulate until Friday afternoon, then send them along and expect the best results. You know who you are ....
Thursday, June 6, 2013
Gettysburg
"The greatest battle ever fought on the North American continent began over shoes." With these words, Ken Burns introduced his PBS Civil War episode on the pivotal Gettysburg campaign. Lee once again invaded the North hoping to further damage Northern morale and perhaps encourage British and French sympathy.
He was taking great tactical risks, operating out of touch with his supply line. His first target was the important railhead of Harrisburg PA, northwest of Philadelphia and, more important, Washington. Union army commander Geoge Meade shadowed Lee's army as it marched north in late Spring into early summer, keeping his troops between Lee and the capital. Only a few miles separated many Confederate and Union units, and cavalry skirmishes were frequent.
When lead elements of Lee's army arrived north of the small town of Gettysburg, they headed toward Gettysburg to ransack the local shoe factory. But, they unexpectedly clashed with Union advance units. Both armies rushed reinforcements into the area and by the end of the day on July 1, fighting had ensued and the rebels held the advantage.
The key to breaking the Union line was a small hill on the left flank forever after known as Little Round Top. Union soliers of the 20th Maine arrived first and withstood several assaults by Alabama boys. Finally, nearly out of ammunition, Colonel Joshua Lawrence Chamberlain, ordered his men to fix bayonets. As the rebels swelled up the hill again, the Mainers executed a perfect bayonet charge and swept the attackers off the hill.
Fighting raged at various locations around the huge battlefield. In each case the Union was able to hold on so that by nightfall on July 2nd, there was a stalemate. Reinforcements were on the way for Union armies, but no such luck for Lee. So, on that fateful July 3, Lee ordered General Longstreet to send Pickett's entire division across a wide field and into a fortified Union position. Of course, Pickett's charge failed and Lee lost the battle.
But, Lee once again got away to fight again. Both sides together suffered 50,000 killed, wounded and captured - twice Antietam's casualties. Lee had lost nearly one third of his army and had to race back to the Virginia border to safety.
It was a great Union victory, and most historians consider it the turning point in the war. The South would never again mount an aggressive offensive campaign outside its borders. But the war would still last another 22 months.
In November 1863, Lincoln traveled to Gettysburg and presented his famous Gettysburg Address in a ceremony to honor the soldiers who died on those 3 bloody days. But there were still more bloody days ahead.
He was taking great tactical risks, operating out of touch with his supply line. His first target was the important railhead of Harrisburg PA, northwest of Philadelphia and, more important, Washington. Union army commander Geoge Meade shadowed Lee's army as it marched north in late Spring into early summer, keeping his troops between Lee and the capital. Only a few miles separated many Confederate and Union units, and cavalry skirmishes were frequent.
When lead elements of Lee's army arrived north of the small town of Gettysburg, they headed toward Gettysburg to ransack the local shoe factory. But, they unexpectedly clashed with Union advance units. Both armies rushed reinforcements into the area and by the end of the day on July 1, fighting had ensued and the rebels held the advantage.
The key to breaking the Union line was a small hill on the left flank forever after known as Little Round Top. Union soliers of the 20th Maine arrived first and withstood several assaults by Alabama boys. Finally, nearly out of ammunition, Colonel Joshua Lawrence Chamberlain, ordered his men to fix bayonets. As the rebels swelled up the hill again, the Mainers executed a perfect bayonet charge and swept the attackers off the hill.
Fighting raged at various locations around the huge battlefield. In each case the Union was able to hold on so that by nightfall on July 2nd, there was a stalemate. Reinforcements were on the way for Union armies, but no such luck for Lee. So, on that fateful July 3, Lee ordered General Longstreet to send Pickett's entire division across a wide field and into a fortified Union position. Of course, Pickett's charge failed and Lee lost the battle.
But, Lee once again got away to fight again. Both sides together suffered 50,000 killed, wounded and captured - twice Antietam's casualties. Lee had lost nearly one third of his army and had to race back to the Virginia border to safety.
It was a great Union victory, and most historians consider it the turning point in the war. The South would never again mount an aggressive offensive campaign outside its borders. But the war would still last another 22 months.
In November 1863, Lincoln traveled to Gettysburg and presented his famous Gettysburg Address in a ceremony to honor the soldiers who died on those 3 bloody days. But there were still more bloody days ahead.
Thursday, June 28, 2012
The Father of Waters
While Meade and Lee clashed at Gettysburg, Grant was tightening his noose around Vicksburg, the Mississippi River fortress city. Confederate General Pemberton and 30,000 rebels had been under siege for months. To escape Union artillery, residents had moved out of the city and into burrows and caves dug into hillsides. Visitors said some looked not much different than your living room, except in a big gopher hole.
Situated high above a bend in the Mississippi, and protected by marshes, Vicksburg was the last major Confederate stronghold on the river. By holding it, and the threat of its huge guns aimed at Union ships, the Confederacy prevented the Union from controlling the river. New Orleans had been in Union hands since early in the war, and upriver the forts had been subdued by Grant in early 1862. Just above New Orleans, Port Hudson continued to harass and damage Union gunboats.
But as June ended, Vicksburg's fate looked inevitable. There was no way to break out, ammunition was low, food was scarce, and Union troops kept moving closer with each passing week. On July 4, one day after Lee's defeat at Gettysburg, the Vicksburg garrison and city surrendered to Grant. A fine Independence Day gift to President Lincoln.
Five days later, hearing that Vicksburg had surrendered, Port Hudson's commander Gen. Gardner surrendered too. From this date to the end of the war, the Union controlled the Mississippi for its entire course. The Confederacy was split, isolating Texas, Arkansas and Louisiana from the other 8 rebel states.
Lincoln's announcement of Union success was characteristically biblical in tone: "The father of waters once again flows unvexed to the sea." (compare that eloquence to our politico crowd of today)
Grant would next move northeast to help the Union recover from the terrible loss at Chickamauga, and lead a Union victory at Chattanooga in the fall. As 1863 ended, the war in the west was over, and Lincoln could concentrate his efforts on destroying the Army of Northern Virginia and Robert E. Lee.
Situated high above a bend in the Mississippi, and protected by marshes, Vicksburg was the last major Confederate stronghold on the river. By holding it, and the threat of its huge guns aimed at Union ships, the Confederacy prevented the Union from controlling the river. New Orleans had been in Union hands since early in the war, and upriver the forts had been subdued by Grant in early 1862. Just above New Orleans, Port Hudson continued to harass and damage Union gunboats.
But as June ended, Vicksburg's fate looked inevitable. There was no way to break out, ammunition was low, food was scarce, and Union troops kept moving closer with each passing week. On July 4, one day after Lee's defeat at Gettysburg, the Vicksburg garrison and city surrendered to Grant. A fine Independence Day gift to President Lincoln.
Five days later, hearing that Vicksburg had surrendered, Port Hudson's commander Gen. Gardner surrendered too. From this date to the end of the war, the Union controlled the Mississippi for its entire course. The Confederacy was split, isolating Texas, Arkansas and Louisiana from the other 8 rebel states.
Lincoln's announcement of Union success was characteristically biblical in tone: "The father of waters once again flows unvexed to the sea." (compare that eloquence to our politico crowd of today)
Grant would next move northeast to help the Union recover from the terrible loss at Chickamauga, and lead a Union victory at Chattanooga in the fall. As 1863 ended, the war in the west was over, and Lincoln could concentrate his efforts on destroying the Army of Northern Virginia and Robert E. Lee.
Real Estate Recovery
For the first time since the real estate collapse, we have seen several indicators move up at the same time. The most persuasive generally are the new building permits and the Case/Shiller index showing 19 of 20 markets moving up. Mr. Shiller, who famously warned of a real estate bubble in 2004, was interviewed yesterday about his views on the index results. He was notably cautious and said if the numbers continue to move up like this he will be optimistic.
We should respect his views and the authority with which he wields it (I know it's hard for you Harvard men and women to defer to an Eli from New Haven). We have many indices to consult on home values, including FHFA tracking of 379 real estate markets. In our business, we don't have the luxury of relying on national or regional trends. We're focused on local influences, and fortunately there are tools to help there.
Other factors constrain us - or at least add complexity. For example, Millenials (those born after 1982) prefer renting. The rental market, even for single family homes, is hot with prices rising and supply short in most places. We have to factor rental market influences both as a preferred lifestyle alternative, and on how they affect home sales. Some have told me they wish appraisers had paid more attention to the rental v. home price gap in markets like Miami prior to 2008, and that we should take a lesson from that experience.
We also have to keep in mind that millions of foreclosures, delayed due to several influences, are once again entering the pipeline. Since about a third of these are suburban homes, be on the lookout for activity and concentrations in markets your clients move people into and out of. There is good data on this activity from several government websites, and from RealtyTrac.
All in all, despite the fits and starts of past predictions that recovery was underway, my view is that we are in a slow climb nearly everywhere. Except for local influences that might bring a market down (a plant closing, base closing, storm impact), we should see continuing modest improvement. As I wrote in early 2009, the Fed will continue to keep rates low and mortgage rates will be at or near historic lows for a long time to come.
I'd like to hear your views.
We should respect his views and the authority with which he wields it (I know it's hard for you Harvard men and women to defer to an Eli from New Haven). We have many indices to consult on home values, including FHFA tracking of 379 real estate markets. In our business, we don't have the luxury of relying on national or regional trends. We're focused on local influences, and fortunately there are tools to help there.
Other factors constrain us - or at least add complexity. For example, Millenials (those born after 1982) prefer renting. The rental market, even for single family homes, is hot with prices rising and supply short in most places. We have to factor rental market influences both as a preferred lifestyle alternative, and on how they affect home sales. Some have told me they wish appraisers had paid more attention to the rental v. home price gap in markets like Miami prior to 2008, and that we should take a lesson from that experience.
We also have to keep in mind that millions of foreclosures, delayed due to several influences, are once again entering the pipeline. Since about a third of these are suburban homes, be on the lookout for activity and concentrations in markets your clients move people into and out of. There is good data on this activity from several government websites, and from RealtyTrac.
All in all, despite the fits and starts of past predictions that recovery was underway, my view is that we are in a slow climb nearly everywhere. Except for local influences that might bring a market down (a plant closing, base closing, storm impact), we should see continuing modest improvement. As I wrote in early 2009, the Fed will continue to keep rates low and mortgage rates will be at or near historic lows for a long time to come.
I'd like to hear your views.
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