It shocks me to be reading on how the U-haul index is getting worse right now. Back in August I blogged about it and there were sites where I cost 4 times as much to rent a U-haul one way as the other. For those who don't recall, the U-haul index is an indicator of the directionality of job flow in or out of a region. So I decided to revisit it.
My previous article:
A quick review of the U-haul intex:
1. Pick a city and see how much it costs both ways to rent a U-haul in/out of the area to multiple destinations.
2. The more expensive direction is the direction that has an unbalanced surplus of jobs going in that direction.
3. If all destinations from a city are more expensive, it means a net-outflow of jobs.
4. The further the travel, the more likely prices also reflect interactions of mid-point job flows. But it should give a trend.
I’m going to redo the same cities to/from
Prices from city listed to 90277/Prices from 90277 to city listed:
What can we conclude?
First, lets look at the old results from August:
90277 to Austin Texas: $6,439 Return: $575 Yes, over 10X more expensive!
It appears I was only a little “optimistic” predicting that by Mid-October Joe Sixpack would know that home prices are declining. But I wasn’t too far off. He and Jane Sixpack know home prices are weak to declining. They just believe the NAR propaganda that prices will recover.
I’m still floored by the demand to
The longer people dig their heads in the sand the more population will capitulate and leave the state. On one hand, that’s good for those that want to stay in state. On the other, there is a point to where workers deserting will break the economy.
2007 will be interesting for SoCal real estate. For the most part the California U-haul index is staying the same: bad. Really bad.