Classic rush for the exits... Houses, tulip bulbs, pets.com stock, it's all the same thing when the music stops and the Ponzi scheme ends...
Thanks HP'er powerlines for the image.
Amazing.
May 27, 2006
Virginia: This is what a housing panic looks like
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47 comments:
No bubble here. Move along...
it's a housing panic!
And now a report from ground zero.
I spent a few years knocking down houses in places like Falls Church. real Estate has exploded to thepoint to where folks with a ranch house on a uarter acer were being offer $700,000 for their hose. The buyer would then knock the house down and build a mansion.
It's hard to call it a panic when 90% of the people are sitting on 500,000 in equity. Will prices drop? I think so. I Fairfax a condo can sell for $700,000 a town house $1.5 million. But most property owners look at the price htey bought, then look at the current price - THEY MADE MONEY AND ARE MAKING MONEY AS FAR AS THEY ARE CONCERN!!!!
THERE IS NO PANIC SELLING
in fact your post are becoming indication of Panic day tradeers of homes that have been left out.
Pheonix has risen inprice since you sold
Washington is up since you sold
Michigian is up since you sold.
Kieth you lost 6% real estate commisions, plus another 3% or so - not the end of the world.
You might lose 20%, you might break even.
Call yourself a loser and just move on
"Call yourself a loser and just move on "
Why can't we be friends? Nothing goes up in price forever. This is clearly a mania.
Warren Buffet Famous Saying. . .
The reason I am so rich is because I sold too soon!. . .need I say more?
This blog can now consider its work done - . . Barrons Today called the end of the housing bubble, and they called the end of the internet bubble in January 2000. . .nice work everyone.
Those are some scary numbers, certainly but not a surprise. The areas of greatest speculative activity will likely feel the strongest slowing.
Keith, I was thinking of your bullishness on Gold and other commodities when I came across this piece by Jeremy Siegel. Funny, I wonder why you didn't post about it?
He writes, don't become too enthusiastic about commodities. When everyone is talking about any asset, as they are now about gold, silver, and other commodities, it is an excellent sign that prices have gone too high. The bulls maintain that the world economy is strong and China has an insatiable demand for oil and other industrial metals to feed its manufacturing base. But commodity prices peaked a quarter century ago amid very similar talk of worldwide shortages, but then suffered a twenty year bear market.
The long-term trend of commodity prices relative to other assets is downward. Better extraction processes, cheaper substitutes, and incentives to economize on high-priced resources put a lid on long-term prices. Don't commit your investment dollars to what will be viewed years from now as a top of the commodity price bubble.
Hey Dogcrap Green, what if no one else buys a home in Pheonix ever again? I mean it's possible, it's hotter than hell, all the RE jobs will be gone by Christmas, there will be over 100k homes for sale by Christmas, and it's an ugly horrible place!
I say within a years time the median price for a home in Phoenix will be 150k, yea that right! And there will be no buyers, none at all.
It's hard to call it a panic when 90% of the people are sitting on 500,000 in equity.
That percentage is way, way, way too high. You are also assuming that those with all of that equity didn't take out home equity loans or HELOCs to buy a bunch of crap.
People who bought a 3/1 ARM in 2003 will start to panic as their rates reset (if you look at the mortgage chart for that time, there was a huge dip on interest rates in June of that year). Then they will be eager to sell. What good is all of that equity going to do when you can't make your monthly payment?
Osman,
As someone who has a smaller postition in commodities, and a larger position in real estate than is probably wise, I thought I'd offer a researched technical analysis counterpoint to your post.
Please read this article and then decide where the real bubble is :)
http://tinyurl.com/orka5
home available might be up in DC but the prices are not yet dropping which means most of those selling are not in a rush otherwise prices would already be dropping. The signs are there for a burst but until the price drops the rest is just precursors but do not mean much.
home available might be up in DC but the prices are not yet dropping which means most of those selling are not in a rush otherwise prices would already be dropping. The signs are there for a burst but until the price drops the rest is just precursors but do not mean much.
They are falling. See through the lags.
After the Housing Bubble.... investors will go back to buying stocks... using gaind from real estate market...imho
I have no idea why anyone would live in Phoenix. Gonna be as close to a ghost town as one can get in present day america.
"home available might be up in DC but the prices are not yet dropping which means most of those selling are not in a rush otherwise prices would already be dropping."
No. But the longer they avoid the rush more cut-throat it will be
on the way down.
Dogcrap, you are the man. Keep up the good work putting Keith in his place. What a tool you are Keith...you really know nothing.
"Anonymous said...
Dogcrap, you are the man. Keep up the good work putting Keith in his place. What a tool you are Keith...you really know nothing. "
Uh, actually, my case is supported by the facts. Dogcraps is supported by, well, it's not
Thanks for the technical analysis commentry anon and the comments on cycles foobeca.
While I'm not a technical analyst nor do I claim much understanding of it, I do find that approach interesting. Drawing technical analyses while ignoring company fundamentals though... well, that just never made sense to me.
With that said ,I know substantial wealth has been created through technical analysis alone.
If the dollar continues its slide, perhaps gold and other commodities will continue their upward movement. But with all the attention gold has been getting, how much of that news is already priced in? Its widely expected that the dollar will continue to slide. That strongly suggests the trading value of gold already reflects the pessimism about the dollar.
home available might be up in DC but the prices are not yet dropping which means most of those selling are not in a rush otherwise prices would already be dropping.
Sorry to disagree.
I live in VA and follow the RE market pretty closely...and those PRICE REDUCED signs are going up all over the place.
Lots of houses are failing to sell and failing to rent- they are just sitting there like mausoleums.
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