Wow. I would imagine people in Sacramento (and around the country) who put deposits down on condos and houses to flip are thinking real hard about walking away from those deposits right about now.
Also, don't the public homebuilders have to report surges in cancellations once they are known? This article today is right on top of one earlier this week on cancellations which noted:
Cancellations are up dramatically over a year ago, in large part because more would-be buyers are finding they can't sell their existing homes fast enough or for as much as they had hoped, said John Orr, the BIA's president. November cancellations represented about 40 percent of sales last month, BIA data show, compared with just 16 percent in November 2004.
From lines to buy to lines to sell in just a few months. Oh, how quickly the worm turns...
On a sun-scorched Saturday 18 months ago, hordes of people lined up for hours outside a sales trailer in a West Sacramento housing development called The Rivers. Their prize: stylish homes at $550,000 and up.
Now they're lining up to sell. The homes that sold in July 2004 have just been completed, and some owners want out. On one small street, Woodhaven Place, five buyers have put their properties on the market. Three have already dropped their asking prices.
"If I had known a year later that there would be a million homes listed, I might not have bought," said Lynette Wall, a real estate agent who helped her husband buy an $809,000 home on Woodhaven.
A wintry chill has descended on the Sacramento housing market. Sales have slowed, cancellations of new-home purchases have soared, and prices in some areas are edging downward - signaling the end of an epic housing boom that increased wealth, generated jobs and turned real estate into the healthiest sector of an otherwise sluggish economy.
"For Sale" signs have doubled in the past six months. Cancellations of new-home purchases shot up 260 percent in the third quarter over last year, says Hanley Wood Market Intelligence.
December 18, 2005
Here come the cancellations: Built on the boom: Realty feels a chill - Days of torrid buying, prices giving way to 'for sale' cycle
Posted by blogger at 12/18/2005