Tuesday, July 15, 2014
Report from Portland, Oregon---No Recession Here
Report from Portland, Oregon---No Recession Here What Recession? Lex Loeb Contributor Network . It is easy to be confused if there is a recession or not in Portland. You go on a Monday night and see moderate to expensive restaurants filled with every seat in all the windows taken and you have to wonder if there really is a recession going on. The same seems to be true in local real estate where even at the far away second home beaches there is no apparent pain or forced selling. There is no commercial property that pencils out as bargained price either. The real estate rule of thumb before the bubble was that you wanted to buy commercial properties that netted at least 10% on your investment and Portland seems to have a few bargains and full occupancy except for the big over priced glamor mall downtown general properties purchased. Satisfied with a 4% yield on a real estate investment when California, Florida and elsewhere can give you net way over 10% now, if not 20% and more in distress sales, Clearly Portland is still in bubble mode or was it really a bubble at all? There is practically full commercial occupancy though out the city and a number of moderately large size building projects continue as if nothing is wrong in the market. Condos are still selling at prices more than prices they were once flipped for but going back 3 or more years not flips from the last few years. One theory about why Portland is still in better shape than elsewhere is because of the caravan of new , generally younger people moving to Portland from elsewhere. Californians may be selling their over priced homes at half price and still finding equity left over to snap up bargain priced Portland slum housing at 500K? The other interesting thing about Portland is that its strict land use planning has artificially limited supply of real estate more than most of the country so new comers are actually paying too much. Many younger people moving to Portland quickly find that they have to rent a room for $400-$3000 because the rental market is alive and well. Did any Starbucks close in Portland recently? McDonald's seems to be doing booming business and there is hardly a hint of any major auto dealerships going out of business. Expensive Homes on the Hills over looking are selling as fast as some of them are falling over the edge in landslide. I have recently seen several emergency crews working frantically to stabilize a couple of homes falling over the edge in Portland Heights. The ones below those about to fall have the for sale signs out in front. Its hard to believe that such large homes can be pinned into place so quickly so they rolling down the hill on the active landslides upon which they were originally built to maximize the view potential. Unfortunately for many inner city Portlanders who are suffering from job losses they would have to spend hours on a bus getting more reasonable prices for their limited dollars to get to a walmart because of the City's Walmart ban. With the luxurious dining going on Monday nights it is no wonder why Portland can afford to keep walmart out of the center of the city. Portland is holding up so well in the recession that the city's third whole foods store is the new Walmart. I have socialist friends cheering on the coming of the next great depression who shop at whole foods stores themselves so I am beginning to understand why Portland is doing so well. Rich socialists get richer when they provoke a major economic contraction. It seems to be obvious that a lot of rich socialists in town are getting very rich when the rest of the country is reported to be going to hell in a $6000 Louis Vitton Purse. It must be public employees making the state economy so vibrant since they all got major salary raises from the governor. It is probably school teachers who are in the windows of the restaurants having dinner on Monday night for $90 for a couple? When I read about the great depression threat hanging over the nation and the world and see what is happening in Portland, including my recent visit to the new 9 Hotel over the Macy's store and seeing it's amazing high priced popularity, it seems either there is no recession at all or people are just maxing out their credit cards in Portland hoping that the congress brings back the old bankruptcy law where they won't have to pay it back? Maybe Portland is sort of the new Berlin before the great hyper inflation and the sophisticated Portlanders know that soon they will all be going broke so they might as well have fun while they can still use money? Last dance in Portland or Phony economic news ? Our socailist friends are confused because they want their depression as much as possible to bring the need for a new FDR or Castro to power and they think nothing of spending $120 for dinner for two in a restaurant on a Monday night.but that maybe because they are government employed school teachers? I am confused. .