In an article I wrote yesterday, entitled Hitting the skids in Florida, I examined the fallout of depressed real estate prices and how folks are coping with a new reality. Today, the FT has an article about how the changes in global real estate are affecting places like Spain.
In Spain's Property Market Headed for a Fall, the FT examines financial conditions in Spain that are leading to a perfect storm. The story cites tightening credit conditions (ie, it's harder to borrow money), the oversupply of houses, and rampant price inflation as leading to a precarious present for Spanish residents. Spanish prices have dropped almost 30% from where they were at this time last year.
Sound familiar?
We're suffering from some of the same malaise but I have to say, that after a slow going, our Federal Reserve has moved quickly and decisively to address some of the same issues on American soil.
The difference between the Spanish situation and our own appears to be government intervention. Where our Federal Reserve has added a lot of liquidity into ailing banks, lowered interest rates, and even orchestrated a bailout, Spain's Socialist government seems focused on job retraining and stepping up public works projects.
We'll see where this all pans out.
Zack Miller is the managing editor of IsraelNewsletter.com and a former equity analyst for a leading multinational hedge fund.
And we thought Florida real estate was bad
Related Posts
- HUD Secretary Jackson resigns under a cloud (40 days ago - 1 Comments)
- Hitting the skids in Florida (45 days ago - 3 Comments)
- Sam Zell sees real estate turnaround this spring (74 days ago - 5 Comments)
- DDR: Developers Diversified Realty poised for growth? (8 days ago - 3 Comments)
- Blackstone's Indian land grab (12 days ago - 0 Comments)
Add your comments
Please keep your comments relevant to this blog entry. Email addresses are never displayed, but they are required to confirm your comments.
When you enter your name and email address, you'll be sent a link to confirm your comment, and a password. To leave another comment, just use that password.
To create a live link, simply type the URL (including http://) or email address and we will make it a live link for you. You can put up to 3 URLs in your comments. Line breaks and paragraphs are automatically converted — no need to use <p> or <br> tags.
Earnings expectations for JC Penney, Nordstrom, Macy's, Abercrombie and others
Comfort Zone Investing: Financial stocks: Is the worst over yet?
How Washington can cut gas prices fast -- and why it won't
Reader Comments (Page 1 of 1)
3-27-2008 @ 7:50PM
Carol Lovejoy said...
NowistheTimehttp://getsavings.ambitenergy.biz
3-28-2008 @ 8:46AM
william lindblad said...
Astute post - You might want to look at G.B. also. The boom was world wide and so-called sub prime was not confined to the U.S. While Bear Sterns is all of our news, Northern Rock made quite a splash in G.B. The money lending reached into all parts of the world and the question of who owes who still remains. The Fed moved in an offensive pro-active manner. Many have been critical, but the other side could have been a chain reaction in the economic sense of nuclear proportion. There is a lot of anxiety throughout and a case of fear would be sure to spread. Compare the events of 1929 and you find that once it starts - it's hard to stop.
3-28-2008 @ 2:57PM
john sabia said...
Very good post - Great contrast
The actions of the Fed/ government are the reason why our markets are far more resilient than those abroad.
4-13-2008 @ 12:15PM
Zen Borgia said...
Really I cant agree and maybe here is the reason why, and abord markets are not very relevant
http://www.bestsyndication.com/?q=20080325_commercial_investment_property.htm