According to Careercast.com, Memphis, TN topped their list of the best cities to find a job in March.  The firm takes the number of new job openings in a metro area and divides it by the population.  In Memphis, the number of new openings was up 14% from the prior month.

Other cities topping the list included: St. Louis (+13%), Tampa (+12%), L.A. (+10%), Miami (+10%), and Nashville (+10%).  At the bottom stood, Detroit (-7%), Milwaukee (-5%), and Cleveland (-3%).

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Former CEO, Gov. Rick Scott of Florida officially signed an economic deal that offers businesses $1 billion in tax cuts over the next 3 years.  Included are cuts in the unemployment tax and corporate tax rates aimed to encourage businesses to hire as well as make the state more competitive for business expansion.

“If we want employers to hire more people, we’ve got to think like they do,” said Scott, a former CEO. “We’ve got to keep their costs as low as they can. We’ve got to make sure that we’re more competitive than any jurisdiction in the world.”

While unemployment remains high at 9.6% in the state, the housing market is starting to show signs of life.  In Orlando inventory has declined from 15,000 homes last year to just over 9,000 today.   Fewer homes are coming on the market and population growth is trending up in the city and overall in Florida.

With the state being pro-business, and a decline in housing inventory, home prices are certain to come back.

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The Orlando MSA saw a continued drop in homes on the market over the last few months.  Inventory now stands at just over 9,000 homes representing roughly a 5-month supply.  However homes in the $100,000-200,000 range exist in less than a 3-month supply.  Bidding wars in this price range are becoming frequent.

If you have interest in the Florida market, please contact us.  Investor Nation offers a great program to help investors acquire, improve, and lease investment property in the Orlando MSA.

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The month supply of new homes in the US fell to its lowest in six years as new homes sales continue a slow upward trend.  The seasonally-adjusted annual pace of new home sales in January was 321,000.  While down slightly from December’s 324,000 the number is over December’s preliminary of 307,000 (which was adjusted up at the time of January’s release).

The month’s supply has slid to 5.6 months showing that new home sales are trending up (slowly).  A healthy market is typically 6 months supply or less and while I think the current pace is slow, for the environment it is positive news.  This should be good news as well for investors who buy high quality existing SFR as they are the next best thing a potential buyer could acquire.

A colleague over at Barclay’s shared this chart that explains it best:

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According to the Orlando Realtors Association, the median price of homes rose 12% in December 2012 over December 2011.  Excluding distressed sales, the median price in was $159,000.  The cumulative median price for all of 2011 was $109,900 which is higher than 2010’s $108,500.

Other numbers to note from the Realtors year-end report:

• Foreclosure sales were down over 56% in 2011 as the foreclosure pipeline starts winding down
• Total sales were down in 2011 to 34,670 from 2010’s 35,140, a decline of 1.34%.  This decline is low considering no home buyer tax credit existed in 2011.
• Short sales account for 75% of all pending contracts
• Inventory is down 35% from December of last year
• Current supply stands at 4.58 months versus about 6 months last year at year end.
• Normal sales were up 12% in 2011, Short sales were up 21%, while bank-owned were down 27%

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Analysts for Goldman Sachs Hui Shan and Sven Jari Stehn predict that the U.S. housing market will reach a bottom in the second half of this year.  The analyst built a model that considers equilibrium home prices for each of 147 metropolitan statistical areas.  Data points include population, income, lending costs, and construction costs.  Also factored are the number of subprime loans in markets as well as excess supply of homes.

Among the best performers include Miami, Detroit, and Cleveland.  Among the worst performers are Atlanta and  Portland with  projected 8% and 6% declines respectively.

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Over the last 12 months, inventory in Memphis has dropped by 14%.  Since 2008, inventory levels are down nearly 43% in the Memphis metro area.   And while supply stands at roughly 8 months worth, the pace of sales should increase in 2012 due to an improving local economy, continued population growth in the MSA, and higher household formation.

I believe we’ll see price stabilization in Q1 2012 with subsequent appreciation beginning.  This will primarily be due to the absent of a large foreclosure wave in the area.  Foreclosures seem to continue trickling out and Memphis has seen very limited short sale data (contrast to many major markets).

See the chart I prepared with the inventory drop:

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Over the last 18 months we’ve been investigating the housing market in Florida.  It of course is one of the poster children of the housing crisis.  Home prices have now dropped as much as 50% in some of the sub-markets of the state.  A year ago we started acquiring homes in Miami-Dade county and this year in the Orlando area.  In fact, Ryan Hinricher on our team relocated from New York, NY to the Orlando metro area.  We’re now fully entrenched in Florida and have built a great extended team in Florida.

We felt the time was right after seeing the yields on real estate turn from negative to positive.  The Florida market typically has a boom-bust cycle where the busts are followed by a subsequent boom.  Since population growth is one of the top drivers of housing, we felt the Florida market could not be ignored.  In the next 18 years Florida is expected to grow by nearly 10 million people.  Those people will undoubtedly need housing.  Further the Orlando metro area just had a record number of visitors becoming the “most visited city in America.”

But investing in Florida isn’t as simple as most markets.  For investors looking for financing, we’ve seen it more difficult to obtain.  Appraisals are inconsistent as the market stabilizes.  Miami is more challenging than Central Florida and Orlando in this regard.  But a home that costs around $110,000 will yield you 1% of the purchase price in rent or around $1,100 per month.  Be mindful that many homes in this price range once sold for nearly twice this price or more.

The big number we’ve been watching is the inventory of homes.  In 2006 the Orlando MSA had 26,000 homes on the market. Today that number is hovering around 10,000 or a 5-month supply.  And according the Orlando Regional Realtor Association the median home price rose 9.5% year-over-year in November.  In Miami the market peaked at 43,000 homes.  Today Miami has less than 15,000 homes on the market.

The crux of investing in Florida is a highly diversified exit strategy.  Vacationers, permanent residents, international buyers, and snowbirds all compete for homes on the market.   If you can live with a little less monthly yield in return for solid growth prospects, this might be the perfect time for you to consider buying a home in Florida.

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Coldwell Banker has been putting out some great infographics lately.  We wanted to vet them and pass the most relevant ones on to you.  This particular one allows you to visualize prices from the peak-to-2010-trough.  You can click on the below map and choose the state to review.  You can compare apples-to-apples and apples-to-oranges this way.

Just click the image below:

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Being the most affordable college town for housing doesn’t necessarily mean you have the best team.  Coldwell banker ranks affordability of the 120 Football Bowl Subdivision schools.  Not only is it fun to see where your city stacks up, but college towns can be very good places to build an income property portfolio.  Parent investors often battle local and out-of-state investors for real estate near the college.

Here’s the top 20 most affordable college towns in 2011:

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