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From: Paula Higman
Engel & Völkers
890 Main Street 5-101
435-602-8228
MARKET CONDITIONS IN THE LAST 10 MONTHS AND FOR THE NEXT 12-18 MONTHS:
· Silver Star was sold in August of 2017 and I believe that market conditions have deteriorated in Park City since August of 2017.
· Furthermore, the PC market is very seasonal, and with the following changes in the economy, I believe PC will have a very slow 2018 Summer/Fall/Winter carrying right through till Spring of 2019
CLASSIC ECONOMIC INDICATORS FOR A DOWNTURN:
· Ending of quantitative easing
· Massive selling of US Bonds, taking liquidity out of the market
· Short and Long Term Yields Increasing
· Flattening of the debt yield curve
· Consumer Debt at Historic High
· Consumer Confidence at 18 Year High
· Unemployment Rate at 49 Year Low
DETAIL ON THE INDICATORS:
· Long Term Yields are up nearly 0.70% in the last 10 months, since Silver Star #501 sold, and mortgage rates are up an average of 1.22%
· Short Term Debt Yields are rising quickly compressing the Yield Curve. This has a huge strain on Short Term Corporate Debt and Consumer Debt
· Consumer Debt hit a new high of $13 trillion last year, surpassing the previous record set in 2008 by $280 billion.
· 2 year Treasury ended the week at 2.47%.
· 2 year Treasury was at 1.33% when Silver Star sold on 8/31/2017
· 30 Day LIBOR just hit 2.00%, the first reset at 2.00% since November 4, 2008.
· The next Fed meeting is June 13th and markets have a 100% probability of a hike.
· LIBOR should be roughly 2.10% – 2.15% by mid-June.
· A hike in September would put it around 2.35%.
· A hike in December would put it around 2.60%.
· Consumer confidence hit 18 year high in February of 2018. Since 1966 when the US Consumer Confidence hits a new multi-year high, we have seen down turn in the real estate market. (1968, 1978, 1989, 1999, 2007, and now February of 2018)
· The Unemployment Rate ‘UR’ hit an 18 year low at 3.8%. In fact, the precise print was 3.755%. The last time the UR was at 3.7% – 1969.
