November 19, 2005

From the belly of the beast - realtor talking points on the bubble


Here they are folks - National Association of Realtors' (NAR) talking points used to calm freaked out buyers and sellers. Aren't they great? The nice thing is after it bursts, we'll have this smoking gun to shove back in their face

There is virtually no risk of a national housing price bubble, based on the fundamental demand for housing and predictable economic factors. It is possible for local bubbles to surface under the right circumstances, but that also is unlikely in the current environment. There are tight supplies of homes available for sale in most of the country, and labor markets have been improving. In other words, the two conditions necessary for price softness do not exist in most of the country.

24 comments:

Everyone Calm Down said...

What is the purpose of this blog? I'll tell you what I use it (and others like it for).......I track all the new listings of "anti-" sentiment blogs and postings in a spreadsheet from google, and invest based on those trends. Thank you all for helping me identify opportunities in:

goog - "isn't worth a $135 IPO!!!"
oil - "prices will stay above $70 forever!!!"
apple - "the mac is dead...they are no longer innovative!!"
dow / s&p / nasdaq - "the economy is in for a recession"
housing - "the sky is falling, the sky is falling!!!"

Check out the four year performances of the above......but I need your help to sustain my performance. I am disappointed that the housing talk, or "panic" has somewhat abated recently.........where were all of you a year ago (or two) when EVERYONE was talking bout the housing bubble......where did all these people go? My guess is they are just pissed because they have been renting for $1000/month and have just realized they have lost $12,000 over the past year. Even the worst investors can do better that losing 12k a year like most renters

I need you and your brethren to post new blogs and new articles about the housing panic....I mean bubble. Once you slow down your writings, then I will start to get worried.

How old is this blog anyway? My guess it is fairly recent.....

keith said...

everyone calm down, thank you for visiting - we love to hear folks who are either 1) heavily vested in this ponzi scheme continuing, or 2) people who don't understand economics, supply and demand and 3) complete and utter dolts

so thanks for visiting - keep coming back and keep posting!

everyone_calm_down said...

Over the past eighty years, which of the below has failed to return 10% a year annualy?

A. Dow Jones
B. S & P 500
C. Housing Prices for a 1 BR Home
D. Gold

Tell me the answer to the above, and you can probably guess where I am invested. I know the stock market is not going to always go up, the housing market is not going to always go up, etc,,,,,,however over the LONG TERM, 3 of the above 4 will result in annual gains superior to any other investment. It is real easy to say that housing prices will go down......it is also real easy to know where to properly invest.

everyone_calm_down said...

Actually, this site is pretty good: www.curbed.com

While I don't agree with what most of curbed.com has to say, it does a good job of calming everyone down.

41cadillac said...

If you want to take the time, check out the price changes in the following builder companies:

I put these companies in a watch list on Yahoo. Easy to check out price changes on the charting site.

The first one, NVR , has a price range of: 52wk Range: 641.00 - 947.95 . September it was $900 per share. Friday it was $732 per share.

Also while your are there at the Yahoo Finance chart, check out the Message board on NVR. Those investors are running scared
Symbol Last Trade Chg
NVR Nov 18 732.05 +4.05
WLS Nov 18 116.00 -2.00
DHOM Nov 18 10.60 -0.01
CHCI Nov 18 15.94 -0.23
CTX Nov 18 73.78 +0.75
MTH Nov 18 63.17 +0.37
HOV Nov 18 48.36 +0.35
TOL Nov 18 34.09 -1.50
LEN Nov 18 56.90 -0.24
PHM Nov 18 40.75 -0.31
PHM Nov 18 40.75 -0.31
SPF Nov 18 37.59 -0.53
DHI Nov 18 34.81 -0.15
BZH Nov 18 69.14 +3.68
IYR Nov 18 64.79 +0.51
FRE Nov 18 62.12 +0.22
FNM Nov 18 47.74 +1.

keith said...

thinking about shorting the builders again this week now that they've come up a bit again... especially NVR

Also, look to short builders exposed to the phoenix market which is imploding, like spg and ctx

foobeca said...

"Everyone Calm Down"

"My guess is they are just pissed because they have been renting for $1000/month and have just realized they have lost $12,000 over the past year. Even the worst investors can do better that losing 12k a year like most renters"

You're a blithering idiot. $12,000/yr in rent is money down the drain just like interest to the mortgage company is. $1000/mo rent where I live would allow me to live in a house worth about $250,000.

The interest only portion of a mortgage of $250,000 is $1300. Then add property taxes and insurance and you're at $1500.

You can rent a house or rent money to buy a house. Either way you're going to throw money down the drain. But with renting right now, you throw less of it down the drain and you incur no risk.

keith said...

here's my math

bought condo 2003 for 165,000
sold condo july 2005 for 315,000
profit: $150,000

renting "$600,000" condo for $2000 / month. cost of owning would be $4500 / mo - $5,000 / mo, plus depreciating, yes depreciating based on government data for sept and oct, 5% a month or $30,000 - PER MONTH

now, who's the idiot?

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