KENTUCKY REPORT

William Thompson

61.990 and in 1980 the census revealed 64.490 when it just about peaked.

by Don A C.mpb.ll

HE housing depression now seems to be involving every Part of the country and every sector of the industry. About all anyone is talking about is holding down losses, not achieving gains. A real estate man said the other day that when this recession started, you could talk about certain parts of the country doing real well. But now, even this market has crumbled and it's not only houses, but office space as well has had more building than it needs.

The real estate market has been off 5090 for nearly three years. In earlier recessions it was down 2090 but came back after 18 months. That kind ofcutbacks we can stand without suffering, but even news from the South is anything but encouraging.

Even the home improvement area, which normally picks up when new housing slows down, is leveled this time. Consumers are showing more interest in co-ops because mortgage money is more available in this area. But with rates at l79o even the most creative financing is slowing down. There is no doubt that if mortgage rates fell several points it could, with "the gimmicks," bring the rates down to around l29o but Your guess is as good as mine and I suppose we will have to wait and see what actually will develop.

Meanwhile the public will get used to a sputtering recovery, one that should last out the year but could fall on its face by '83. The key to this, as it always has been, is interest rates and they just have to come down if we are going to make any progress. Predicting how things are going doesn't mean much anymore. The public does not expect the bottom to drop out of the economy, nor does it believe that the return of good times is only a year or two away. At the present moment the most knowledgeable people that I know of believe that high unemployment, interest rates and rising taxes will be with us until '84. They won't talk about what will happen after that.

For the first time since records have been kept, the rate of home ownership in the U.S. is dropping. There isn't much of a drop, just a fraction of a percent. But, the trend is what looks bad. In 194O, 43.60/o of the nation's households were homeowners. By 1950 this had risen to 5590. Through l!)60 it rose to

This is understandable when we realize that the median price of a home in 1977 was $44,(X)0, down PaYment of $9,000, and monthly house payments of $400. For l98l the median Price had risen to $72,fi)0, the down Payment $16,000, and the monthly Payment was $816. I don't know where home ownership is heading, or if this is just a breathing spell. I do believe that the price of housing is going to have to come down.

Tennessee

execuUYe vlce precldent

l,BOUI 4000 Tennessee families will Ilgetize their dream of homeownership through a $150 million bond sale announced by the Tennessee Housing Development Agency (THDA).

Tennesseans earning up to $30,000 who have not ownedahome inthreeyears are eligible for the 16 year l2YtVo interest rate loans. The three year previous ownership requirement does not apply for residents of targeted economic distress areas.

THDA chairman Grady HaYnes, Haynes Brothers Lumber Co., Murfreesboro, said the issue is the largest ever sold by Tennessee Housing. He said $4.2 million was contributed to the sale from the agency's general fund in order to provide the below-market rate of 123/q0/0, Haynes said the sale would increase Tennesseans' homeownership opportun- ities and provide a significant economic stimulus to the state. The sale requires lenders participating in the prograrn to set aside 3590 of their reserved funds for builder commitments for new housing construction.

"As a result of this sale, Tennessee will gain about 3000 jobs and between $9 and $10 million in state sales tax," he said.

The 57th annual convention is onlY days away at Knoxville. Industry tours and informative programs including Dwight Kessel, Knox County executive; Johnny Majors, University of Tennessee football coach; Randy Tyree, mayor of Knoxville; John Duncan, U.S. Representative, Second Congressional District, Tn.; Dr. Al Matamoros, Armstrong World Industries; Robert Remine, Ernest & Whinney, and C.H. Dean, Tennessee Valley Authority, are all prepared. A Celtic basketball game and moonlight riverboat cruise also await those attending.

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