Bloomberg all but guaranteed the US will experience a recession in 2023
Fortunately, this recession should be more short-lived and less-extensive than the Great Recession. What are you some steps you can take to prepare?
1) Keep a Level Mindset – Recession is just a part of the economic cycle. We’ve enjoyed one of the longests period of economic growth in history, and it’s time for an adjustment. While we will have to make concessions in discretionary spending, this will not resemble the Great Recession.
2) Take Control of Your Finances – Analyze your Income, expendatures, and set aside a 3-6 month emergency fund if possible. Set a monthly budget and adhere to it. For me, Uber Eats is going to be the biggest concession, especially the way prices are now. A $7 pork tenderloin on my BIg Green Egg vs an $80 Italian food delivery. Good Lord now that I think of it I’ve really been wasting money.
3) Don’t Get Behind on Debt – Debt snowballs, and it snowballs even further when you’re behind. Pay off what debt you can going into the recessionary cycle, and do not let yourself get behind.
4) Don’t Panic-Sell Your Investments – The DOW is down around 8% from January and will likely be volatile for the foreeable future. No one has ever mistaken me for Warren Buffett, he’s only 5’10, but unless you’re in dire straits you don’t sell during a depressed market. It will rebound.
5) Keep Saving! – It’s a recession, but the rules of basic home economics still stand. If you’re able to save even 5% of your paycheck, your older self will thank you. Unless you want to work until you’re 90, that is…
6) Be Ready to Invest – While we never know the market has recovered until it’s already rebounded, the wisest investors buy at or near the bottom when others are keeping their money on the sidelines.
I saved writing this towards the end of the month because I had a few economic summits to attend before my monthly prognostication.
The dreaded R-word is on everyone’s minds. The economy is being stimied by spiraling interest rates. Around the corner is job losses and possibly a further stock market correction. Although we have a period of relative discomfort ahead, this will be nothing like 2009. The government printed trillions of dollars and paid people to stay at home, causing too much money chasing too few goods. Sprinkle on that terrible monetary policy over the last few years, and we have the worst inflation in 40 years. Once inflation is tamped down, interest rates will settle again, probably 4.5-5.5% by this time next year.
Despite interest rates being so high, it is now a fantastic time to buy a home. “But John, you wise yet immature savant,” I hear you say, “how is it a good time to buy with interest rates where they are?”. First of all, dear reader, interest rates will go down and we’ll see another refi boom. Secondly, the market is no longer seeing multiple offers going 10% over list price. Sellers are willing to negotiate. If you find that perfect house, now is the time to get it before rates drop and the frenzy begins again. Also, look for builders to cut great deals through the rest of the year.
As I’ve said before, do not look for a “market adjustment”. More people moved to Dallas this year than any other metropolitan area, and balancing the number of buyers with active listings is going to take years. I’m not saying prices are where they were in June, but we’re still 10% up than we were in January.
Another reminder the 6th Annual John Angell Real Estate Group Pumpkin Carving Competition is this month. Email me a pic of your pumpkin. It will be judged on the total quality of the image (background, lighting, angle, creativity and intricacy of the pumpking carving). Judging takes place on Halloween night Monday, October 31st at 6pm.
We’ve almost made it, folks. Just a few more weeks and the most bizarre summer weather we’ve seen in years will be over. I’m still amazed that the ground got so dry that 3-inch wide sized cracks appeared in the ground, yet a week after the August Monsoon we had greenery everywhere. And we had bugs. Good Lord I didn’t miss the bugs, especially cockroaches.
Reminder to everyone the 6th Annual John Angell Real Estate Group Pumpkin Carving Competition is in October. I’ll be dropping off pumpkins to those who would like one, but feel free to supply your own. Email me a pic of your pumpkin, it will be judged on the total quality of the image (background, lighting, angle, creativity and intricacy of the pumpking carving). Judging takes place on Halloween night Monday, October 31st at 6pm (I do not do the judging).
Interest rates and the general economy are major contributors the the real estate slowdown, but we are also in one of the slowest periods of any year. Once kids are back in school, people who have a necessity to move tend to do so. We man never see a market again like we had over the last 24 months, but that’s fine. It was unsustainable. Plenty of sellers and investors absolutely cashed in, unfortunately average buyers and people already hindered by property taxes suffered. The Housing Affordability Index has stalled just above 75, meaning the median household income is 75% of the median home cost ($385,000 in August). Again, that’s not horrible because places like Los Angeles and San Francisco are 16 and 17, respectively. Look for that number to hover for a time, similar to 2014-2016.
This may be jumping the gun a little, but it usually takes me a month or so to I know, I’m obsessed with lawn care. Please bear with me.
Before 2021, I always believed here in Texas we didn’t have to worry quite so much about preparing our lawns for winter. Now I realize we need to fortify them as much almost as much as the northern states, because we’re just one massive freeze away from years of progress being destroyed.
1) Continue Usual Maintenance – Don’t stop mowing and weeding, and keep raking leaves up through the fall. It will allow the waning sunlight to reach the grass, and there will be less leaf to turn brown during the winter. And for God’s sake, don’t stop watering, even in the winter.
2) Ready the Pre-Emergent Herbicide – The early fall (now) is the perfect time to apply an herbicide to stop the spread of weeds and dandelions. Recent EPA regulations have outlawed weed killers that kill man stubborn weeds in North Texas (don’t get me started on why…). A preemergent herbicide will sterilize the weeds so they won’t grow back in the spring… provided we have a nice, cold winter.
3) Additional Fertilizing – When mid-late October approaches, it’ll be a good time to apply additional high-nitrogen lawn fertilizer to your lawn. It’s about to experience what could be an extended period of dormancy, but you need to make sure the roots are strong and run deep. I use Scott’s Bonus-S at the advice of my local Home Depot guru, but I can’t say that’s the best.
4) Know What’s Best for Your Lawn – Without going into details, there are pre-emergents and fertilizers that work great for bermuda grass, but kill St. Augustine on contact, and conversely. Also be mindful of the forecast. Some treatments do not work properly above certain temperatures, and if there is a heavy rain in the forecast it’s pointless to sprinkle anything on your lawn.
The summer of 2022 has been brutal, and according to the Farmer’s Almanac we’re in store for a particularly cold winter. We’ll have our standard 3 weeks of beautiful DFW fall weather, followed by rain, wind and cold. Before the oven becomes a freezer put yourself to work outside and prepare.
Paint, Stain & Reseal – This covers a lot of items. The Texas summer is murder on paint, wood, caulk and sealant, especially south-facing surfaces. The winter moisture will exploit 0this, so make sure the house, fence, and decks are painted/restained and the caulked and sealed surfaces and cracks are stripped and re-sealed. This could take days; always handle the sealing/caulking first!
Replace Old Windows – Window seals are the same as all the others. The heat causes them to expand, the cold contract and lose their seals. Broken seals are typically more unsightly than inefficient, but enough of them can mean higher bills.
Clean the Gutters – Can’t be overstated the damage standing water in your gutters can do to your house, and in extreme cases it can cause the gutters to collapse. A ladder and a blower can save you thousands.
Add Insulation – Every 10-15 years your insulation compacts to the point where it needs to be supplemented. There are instances where it just makes sense to drain all the existing insulation and just start over, especially if you have rodents or squirels in the attic.
Service Your Furnace – As important as servicing your air conditioner is to keeping you cold, servicing your furnace keeps you from dying. Gas leaks can kill.
Fireplace Maintenance – It’s hard to imagine a roaring fire while it’s 100 degrees outside, but before you know it you’ll be wanting one. Make sure the dampers function properly, repair damaged masonry or brickwork, and climb on the roof to in-spect your chimney cap if you have one. If you heard birds chirping up ther during the spring, there may be a flamable abaondoned nest in the chimney!
Inspired by the British Arts & Crafts movement and beginning in the later years of the 1800’s, American Craftsman represented a departure from the ornamentation of the Victorian Style and urban grit of the Industrial Revolution, embracing a return to countryside simplicity. It began in Southern California and spread from 1900-1929 throughout the United States, most common in California and the midwest.
Craftsman homes feature low-pitched, gabled roofs, with overhanging eaves and exposed rafters, signature front porches and tapered columns, large bay windows, and stone or stucco accents. They are almost always painted wood siding, typically with cedar shaker shingles.
Not only is the craftsman style still extremely popular with smaller-sized new construction today, thanks to their quality build they are a common target for renovators, although their small size often warrants signficant additions.
2022 has been the spiciest summer in a decade, and with it comes talk of rollling blackouts and heat advisories. While the modern air conditioner is virtual a miracle (placing its inventor, Willis Carrier, just below the Archangel Michael in the pecking order of saints), in extreme temperatures they need all the help they can get. Here are a few tips to help give your air conditioner a little help:
1) KEEP YOUR SYSTEM MAINTAINED – Hands-down the most important thing you can do. Even if it’s working perfectly, have your technician come out every spring and fall. In the spring they will check your coolant levels, make sure your coils are clean, and give it a full physical.
2) MAINTAIN A CLEAN FILTER – Replace your filter every 1-2 months. Put it in your calendar, write it on the refrigerator or carve it on the back of your hand. A dirty filter not only decreases your efficiency, it heavily burdens the system and can spell an early demise. Also, agents like me use filters as a barometer for how a seller has generally kept a home.
3) CHECK FOR LEAKS – Windows, attic access, and exterior doors should be closed as tightly as possible. Also, in the spring and fall check your ductwork for leaks. Rats and squirels love eating through it.
4) SHADE AND KEEP YOUR CONDENSOR CLEAR – Keeping your condensor out of direct sunlight will help it’s efficiency, but make sure nothing is within 2 feet of the unit. Circulation and shade will make sure the unit is doing it’s job.
5) DON’T CRANK UP THE THERMOSTAT WHILE YOU’RE GONE – While keeping the temperature at 80 while you’re at work may seem like a good idea, in reality it takes more time and energy to cool your house down than it would to simply maintain a constant temperature.
6) ADD INSULATION – You can never have too much in your attic. Insulation is messy, but it’s relatively cheap to have blown into your attic.
7) KEEP DUCTS OPEN – Not only does it not improve efficiency, a closed duct puts stress on your system.