More on the recent news, and an excellent quote about realtors:
In California, homes are generally staying on the market longer than they have for several years, the report said. And there have been sharp declines in home sales led by San Diego County, the San Francisco Bay Area and the northern Central Valley.
Home sales in San Diego are 12.7 percent lower than last year, the sharpest drop of any major urban county in the state. The Bay Area is down an average of 7.2 percent, and home sales in some rural counties around Sacramento, such as El Dorado and Placer, have dropped more than 20 percent
"There are more sellers on the market but fewer transactions that get into escrow," he said.
He added that one reason agents are handling fewer home sales is that there is strong competition from new agents who entered the market in recent years.
"Real estate's been a dumping ground for the unemployed and underemployed," he said.
December 09, 2005
The nation's housing market is in a "perilous position" that could slow the broader economy
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5 comments:
Unemployed and underemployed indeed. But you know you have some real madness going on when you see six-figure wage earners with established companies quiting their jobs to become realtors and loan officers. I cant tell you how much of this we've seen in our area. I'm reminded of our famous gold rush of '49. By the time most of the would-be-rich dropped everything and headed west, the gold was gone.
My 2 cents.
OK … I just want to say a word about a slowing housing market and the extraction machine. My business is located in Southern California, and is indirectly associated with the mortgage industry.
What I witnessed in my business regarding the housing ATM from the spring 2002 to the fall of 2004 was just amazing. I saw countless customers extract capital at extreme levels. Many did it multiple times.
This country is going to pay for this in the form of a major economic slowdown which is likely to begin sometime in the next few business quarters. I suspect foreclosures are likely to skyrocket in Southern California in the coming years. And to those that remember the So Cal real estate meltdown from 91-97 … I think this coming correction is going to be more severe.
There’s no other way for us to get out of this imbalance, other than a dripping long-term decline in real estate prices. I think it may have already started.
think about how many mortgages will be upside-down as folks extracted their windfall gains, and then the windfall goes away, as housing reverts to the mean
$200,000 house, goes up to $400,000, extract $200,000, owe $400,000, goes to $350,000, you need to payback the $50,000, but you spent it on your Hummer.
Chapter 11 here you come
nnvmtgbrkr said...
Unemployed and underemployed indeed. But you know you have some real madness going on when you see six-figure wage earners with established companies quiting their jobs to become realtors and loan officers. I cant tell you how much of this we've seen in our area.
Same thing happened 7 years ago in the IT field. Some idiot plumber read a Java book and got a tech job. Once the bubble was gone the tech job was gone, the plumbing place was out of work, and the person was crying on Usa Today about making $7/hr working at Starbucks.
This won't be any different except the mortgage brokers and real estate people will be competing with the Home Depot worker in the example above for the remaining decent jobs.
>He added that one reason agents are
>handling fewer home sales is that
>there is strong competition from
>new agents who entered the market
>in recent years.
Beg'pardon? How many agents there are (mis)serving the market doens't affect how many total transactions are processed. If sales are down, they are down. Period.
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