The financial forecasts are all calling for 3 percent economic growth through 2011, he said. The Federal Reserve is a little more reserved, with a 2.7 gross domestic product growth estimate, he said. In Hawaii, layoffs and furloughs of public employees will delay recovery in the government sector, he said. But the return of tourists should expand income in the private sector.
“It’s going to end, and we are headinperiod in which revenue estimates were revised downward again and again.g into the next expansion. So you need to start thinking about where we go from here,” he said. “Hey, you (chamber businesses) are still here! I know some didn’t make it. They’re gone. Now you gotta start looking down that road.”
Maui’s unemployment remains high at more than 8 percent, while the state average is about 6.5 percent. Brewbaker indicated most job growth has been on Oahu and the state has not realized a jobless recovery.
As as an aside, Brewbaker noted that Maui routinely has been named the best place to retire because real property taxes are so low. He suggested perhaps elected leaders or those seeking higher office should consider whether there needs to be a “realignment.”
On the housing market, Brewbaker said investors and homebuyers need to start loosening the logjam of foreclosures, because banks won’t be the ones to do it. There are deals to be had, he added.”Maybe you should start to rethink and buy the foreclosures yourselves rather than waiting for the banks to decide what to do with them,” Brewbaker said.
Brewbaker said he was perplexed somewhat by Maui’s home construction trends over the past several years. Virtually nothing is getting built, according to his numbers.
He wondered if the slowdown meant the real estate bubble had burst or if the county’s two-year-old work force housing ordinance was deterring construction. The ordinance requires developers to provide up to 50 percent affordable homes if they want to build market-rate subdivisions.But Brewbaker said that simple math showed that the housing and construction market would turn around. The annual rate of new construction is 0.05 percent, and the population growth rate is 1 percent.
He is returning in a few weeks and saving some special information and statistics for the “Real Estate” crowd. When we get the information I will post it. He is a great source of knowledge and a treat to have the opportunity to attend one of his lectures.