Here's some good Panic definitions - I think we're seeing panic listings, and soon panic selling at any price:
Panic
1) an overwhelming feeling of fear and anxiety;
2) be overcome by a sudden fear;
3) sudden mass fear and anxiety over anticipated events;
Now here's the latest report from Phoenix - thanks HPer Trexia:
Phoenix Housing Market Seen Slowing
The hot Phoenix area housing market is seeing slowing sales and a dramatic spike in housing inventories, according to a research report from Raymond James.
Sales of existing single-family homes and condos fell 24% year over year in February, and listings increased 939% in the same period, Raymond James analyst Rick Murray wrote in a note to clients Monday.
"As prices have stagnated since August, inventory levels have continued to grow, as we suspect an increasing number of speculators are placing their homes on the market," Murray wrote.
It is clear speculators have headed for the exists in Phoenix. Given the increase in mortgage rates recently, it would seem as if this market will continue to face increasingly more challenging conditions, especially in light of the enormous surge in inventory," Murray says.
March 21, 2006
Wow. 939%. Phoenix, you will come to define the Housing Bubble, and reversing Panic
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9 comments:
I wonder what the percentage of speculators would rather be foreclosed on than sell at a loss.
There is a middle ground of short selling the banks. I believe banks have a rough budget for short sales each quarter or year. When they hit that very fast, will they rethink their strategy or just deny all other short sale applications?
I believe we will end up with a lot of REOs in the end. Although it seemed banks got a bit smarter with the last wave. They would actually list them with agencies to get them off the books fast.
If housing in Phoenix becomes dirt cheap, will it be the next big "slum" area as poor people relocate? Or will mostly smart, frugal people relocate avoiding that fate?
Welcome to the reality world !!!
this site needs some work, it never displays right in IE 7.0, pictures and text are never aligned. Get it fixed before IE goes mainstream.
I am so disappointed with my inability to convince a fellow Phoenix-area resident to continue to rent for one more year. I have explained to this cousin that inventory is growing significantly and what that leads to.
I have led by example by renting a house for a modest amount, after selling my house in late 2005 for an immodest amount.
She has to be out of her current house by the end of May because the owner wants to sell it empty and she is now month to month. I do not think that it is likely that prices will be down enough for them to be protected against serious downturns to come. And with the May deadline hanging over her head, she will not be bold enough to insist on a good price. Crap. Her husband is in Iraq, she has three kids under 9, and she may be about to dig herself a hole that she will be in for many years. What the heck is wrong with renting a nice 3 bedroom house in the suburbs for $800 or $900 a month? A year from now, the buying picture will be so much better. Maybe even six months from now.
Can you get her to make a very low offer on the house she is in (which will come to be seen as reasonable in the next few months)?
Otherwise, maybe her husband is making so much money over there in the sandbox that she doesn't care about over spending. I hope he is not military and she is acting on her own.
aruss - simply send her this site.. or print out some pages - especially the phoenix inventory numbers, and this thread
she'll bankrupt herself if she buys. her kids will grow up poor. her husband will divorce her when she gets home
or - she'll live happily ever after, her kids will go to harvard, and she'll buy in 2 - 4 years when the dust has settled, for 1/2 the price of today
hmmm... tough call
off topic: IE7.0
We don't need to fix webpages for m$... I think M$ IE 7.0 needs a fix.
I prefer Mozilla Firefox anyway.
( greetings from another webmaster..)
;-)
>>>Can you get her to make a very low offer on the house she is in (which will come to be seen as reasonable in the next few months)?
That would be a good idea, but there is bad blood there that I am not privy to. She was originally going to buy from the owner at the 1-year mark b/c this guy wanted the cap gains rate. But that fell apart, and she wants out, and apparently the feeling is mutual. She and her husband have owned in the recent past, and I can only guess that there is some social pressure to buy instead of renting another house.
>>>Otherwise, maybe her husband is making so much money over there in the sandbox that she doesn't care about over spending. I hope he is not military and she is acting on her own.
He is not KBR. He is US Army, enlisted salary. He knows about it, but it must be hard for someone gone for the last 7 months to understand how the market has changed directions. Heck, it is hard for many folks right here in bubble central to understand it. She works full-time, and their income is probably a little above average for Phoenix. But not high enough to take this kind of hit.
If she was just shopping, checking stuff out, lowballing, I would not worry, but that is not the vibe I am getting.
I will show her some relevant Phoenix housing trouble articles at a breakfast at my house coming up. Beyond that I have said in an e-mail that if she must buy, then pay no more than 15% below 2005 prices. But that appears futile with a May "deadline."
Thanks again for the advice. I will show her this site, related articles, and the inventory tracking on my home computer. She is not much into computers (except for regular e-mail), so I won't just send her the links.
I learned about her intentions only a week ago, and was dumbfounded. It seems almost like buying into the stock market in September of '29.
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