Are Million Dollar Parking Spaces Part of the Commons?
|June 1, 2012||Posted by Jeffery J. Smith under News|
Government Stats are Hazy So Let the Market Decide
Are Million Dollar Parking Spaces Part of the Commons?
Read the latest data on site values, for what they’re worth, plus a big plug from loud voices. We trim, blend, and append five 2012 articles from: (1) High Gear Media, May 31, on parking by K. Ernst; (2) Dow Jones Newswires, May 31, on indexes by Ka. ; (3) Washington Post, May 21, on gov’t data by O. Wagner (AP); (4) Los Angeles Times, Jun 1, on rates by E.S. Reckard; and (5) Solving for Pattern, May 28, on commentators by H. Silverman.
by Kurt Ernst, by Kathleen Madigan, by Orlin Wagner, by E. Scott Reckard, and by Howard Silverman
New York Tops London With A Million Dollar Parking Space
In London, specifically the trendy and uber-expensive Knightsbridge neighborhood, $849,000 buys you a 350 square foot parking garage, complete with its own overhead door and separate entrance.
In Manhattan, a new ultra-luxury condo building in Greenwich Village is asking a mind-warping $1 million for a single parking space in a communal garage. To even qualify for purchase, first you have to buy one of the building’s largest condo units, which are priced from “just under” $39 million.
As the New York Post points out, a thrifty luxury condo owner could save money by illegally parking on the street. If you racked up a $115 parking ticket each and every day, it would still take you nearly 24 years to reach the million-dollar mark.
JJS: They call them the prices for parking or housing but it’s all really for location.
Home Prices are About More Than Housing
Indexes covering real-estate values include the National Association of Realtors, real-estate websites CoreLogic and Trulia, and government agencies like the Federal Housing Finance Agency and the Commerce Department.
The best known, the S&P/Case-Shiller home price index, reported that home prices nationally fell 2.0% in the first quarter.
The indexes differ in three major ways: the mix of homes listed and sold, seasonal adjustments, and the weighting of different homes and metro areas.
While each methodology has its merits, the end result is that the indexes can disagree by as much as 10 percentage points.
Getting the trend in home prices correct matters because stable prices would signal demand and supply of houses are falling into balance. Clearing out the overhang of unsold homes is a prerequisite for a sustained pickup in building activity.
JJS: There’re bad data all over the place.
Housing Starts: The Problem With Government Numbers
The government’s monthly report on housing starts, a widely watched indicator of the nation’s economic health, turns out to have some problems.
According to a government report, housing starts rose 2.6 percent in April. Or maybe they fell 12.2 percent. Or maybe they rose by a much more dramatic 17.4 percent. It’s hard to say, because the reported number came with a margin of error of plus or minus 14.8 percent.
A footnote to the news release put it this way: “The Census Bureau does not have sufficient statistical evidence to conclude that the actual change is different from zero.”
The margin of error on the housing starts report is so large because the sample size for the survey is so small.
The high margins of error in the latest monthly survey were far from unusual. For month-to-month changes in seasonally adjusted housing starts, the reported margins of error were plus or minus 15.6 percent in March, 15.9 percent in February, and 16.8 percent in January.
JJS: The numbers that matter to buyers turn out to be harder, coming from lenders.
Low Mortgage Rates Attracting More Short-Term Borrowers
With the 15-year rate in sub-3% territory — 2.97%, down from 3.04% a week ago — about 3 in 10 refinancers are opting for loans of less than 30 years. Homeowners are refinancing into 15-year loans at a pace not seen in a decade, aiming to pay off their debt in time for retirement.
Traditional 30-year fixed-rate loans are averaging 3.75%, a record low for the fifth straight week.
Fewer than a quarter of mortgages these days are used to buy homes [the rest are for refinancings].
Mortgage rates tend to rise and fall along with the yield, or effective interest rate, on U.S. government debt. The 10-year Treasury note serves as a benchmark for fixed-rate loans.
Five years ago, in June 2007, the average yield on the 10-year Treasury was above 5%, and late last June it exceeded 3%. The yield fell to 1.58% on Thursday, as investors troubled by the threat of defaults in European countries crowded into the perceived safety of U.S. government bonds.
JJS: Lenders and sellers now get most of the value of a location but do nothing to deserve any of it. Lenders should profit only from mortgages for buildings and landowners should profit not from their own land exclusively but from all the land in their region equally. The value of land belongs in the commons.
O’Reilly and Dobbs On the Commons
The counter-intuitive can confound or captivate — or both.
Case in point: Bill O’Reilly and Lou Dobbs [two conservative commentators] advocate for the commons and for a principal mechanism of common asset management, the shareholder trust.
O’Reilly: It is my contention that we the people own the gas and oil discovered in America. It’s our land, and the government administers it in our name.
That’s why oil companies have to get permits. They can’t just run around drilling anywhere. That’s why there are environmental laws — to protect the land and the water, which, again, are the domain of we the people. …
Dobbs: You hit on it. The oil we’re talking about, the petroleum we’re talking about, the coal, all of the vast energy reserves in this country, belong to us, as you say.
In Alaska there’s a perfect model for what we should do as a nation. We should have what they call there a Permanent Trust. Let’s call it the American Trust. And oil companies, who put about $10 billion dollars into fees and royalties every year [should] have that money go into this trust fund, not to be touched by the Treasury Department or any federal agency, but simply for investment on behalf of the American people — citizens.
A couple of things happen. One is that it reminds everybody whose oil this is, whose coal this is, and what the rights of an American citizen are. …
O’Reilly: You would do that on a national level? And people would get a little largess from the oil companies?
Dobbs: Absolutely. A little largess and a little respect.
JJS: I think these guys are onto something.
Slugging — The People’s Transit & Antidote