The corrupt David Lereah and his henchmen a the NAR issued this SHOCKING release today, continuing their new "open and honest" strategy of talking DOWN home prices, versus the failed "home prices never fall - real estate is always a great investment" strategy they were on just a few short weeks ago.
Plus they're seeing the data and they know they're just about to put out some really bad YoY numbers. Amazing even the NAR can't hide the price declines given the use of incentives - that means prices are really getting clobbered now.
Why the shift at the NAR? Because realtors aren't eating anymore. Realtors can't pay their lexus lease anymore. Realtors can't even make their own house payments anymore. No transactions = no money. So how do you get transactions going again? You lower the damn price! Brilliant!
Bucket of tar. Bag of feathers. Apply. Got it?
Home Sales Forecast Lowered, Prices To Dip Temporarily
Home sales during the rest of the year will be lower than earlier projections as the market works its way through an inventory and price imbalance, according to the National Association of Realtors®.
David Lereah, NAR’s chief economist, said the most obvious effect in the near term will be with home prices. “A year ago we had record home sales and tight supply with buyers bidding over the asking price,” he said. “This year sales are slowing, homes are plentiful and sellers are negotiating. Under these conditions, we’ll probably see prices dip temporarily below year-ago levels as the market works through a build up in housing inventory.”
“This is a normal pattern during a market correction, but home prices should return to positive territory within a few months and annual appreciation will be slower than historic norms,” Lereah said. “Keep in mind that over time, home prices rise at the rate of inflation plus one-to-two percentage points – buyers in most of the country who plan to stay in their home for a normal period of homeownership can pretty well bank on those historic averages, but people who purchased last year with the intent of flipping are likely to get burned.”
September 07, 2006
FLASH: NAR ADMITS HOME PRICES TO PLUMMET, HOMES DEPRECIATING ASSETS, "PEOPLE WHO PURCHASED LAST YEAR.. TO GET BURNED"
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24 comments:
what's the stage after denial?
How does NAR make its money? Membership dues? Is it possible to short NAR?
Lereah said. “Keep in mind that over time, home prices rise at the rate of inflation plus one-to-two percentage points"
Okay, so they've gone up 200 percent over the last 5 years. so how many years of negative or zero appreciation are we in for till we get back to the Lereah stated average of "one or two percent a year plus inflation." about 25 years?
Take a look at the 1989 to 1995 periods where prices were under the trend line. So we can expect a few more years of flat or price declines.
If I were in the market to buy I would offer at least 30% under the original listing price. In the cases of LV, Miami, Naples etc. I would offer 40-45% less
THIS IS Absolutely AMAZING!!!
The first of MANY MANY stories like this to come
Guy accused of Real Estate Fraud in San Diego kicks the crap of a reporter
You tube Link
http://tinyurl.com/fa6ee
http://www.youtube.com/watch?v=Thn2BGOj31I&eurl=http%3A%2F%2Fconsumerist%2Ecom%2F
FC John
The theater is not on fire...
The smoke?? Oh well that's just part of the movie, it's ok.
That orange glow? Oh, well that's fire, but it's well contained...
Just stay in your seats and enjoy the rest of the movie... Oh, and don't let the rising temp bother you either, that's just a normal part of the movie...
The fire's not spreading... No, it's supposed to do that, very soon you'll watch it go the other way...
What total BS coming out of that man's mouth. He's still a corrupt lier. The evidence is just too overwhelming. He still isn't calling for a massive change in prices, or a long drawn out correction.
Those are the only two outcomes. Fast and quick, or slow and long... There will be a ton of money to made in both types of crashes though. I've got about 1.5 million just waiting to cut the throats of those option ARM lenders....
This is going to be the most fun I've had in a long time.
Keith you know good and well that these snakes are not trying to be honest. The power point and this statement are geared toward scaring the hell out of sellers so they will drop their asking prices, pull buyers down off the fence and get the commission flow going.
Somebody ought to make a bonfire out of the 12c cutout books of Lereah's and burn it on the NAR's front lawn, "All caught on videotape!"
Leave two left: "Are you missing the real estate BOOM?", and the "followup", "Why the BOOM will NOT BUST!"
I wonder if somebody who bought his book, and then bought a house in 2005 has grounds to sue?
"should return to positive territory within a few months". what the heck is positive territory? positive from the bottom? positively low?
plus, i dont see how people can get burned when it is only going to take a temporary hit? these are exclusive to each other
“This is a normal pattern during a market correction, but home prices should return to positive territory within a few months and annual appreciation will be slower than historic norms,” Lereah said.
There's nothing "normal" about this real estate market. Sales have totally dried up, and price remain very high with limit price declines.
I predict a 3-5 year correction resulting in 30-75% drop in prices from todays levels.
Some areas were inflated more than others, like Phoenix. Sorry, but Arizona is toast; Phoenix ought to fall at least 60% (if not 75%) by 2009.
I think most of Florida ought to see a 40-55% drop in prices by 2009 as well.
-Dragasoni-
"What they really should be doing is to warn anyone against toxic loans and only buy a place that you plan to stay in for a long time and one in which you qualify for a 30 yr fixed rate mortgage. "
Then the market will decline even faster!
can you imagine if you bought a new $1,000,000 toll brothers home a year ago today, after reading Lereah's book, and then read that headline today?
Oh, man, that can't feel good...
OK, I over-reached. But damn, it sure is fun, as that's what they really know is going to happen..
plum·met (plŭm'ĭt)
n.
See plumb bob.
Something that weighs down or oppresses; a burden.
intr.v., -met·ed, -met·ing, -mets.
To fall straight down; plunge.
To decline suddenly and steeply:
Wall Street, already armed with recent economic data pointing to a housing slowdown, was forced to digest sour anecdotal evidence as well. Beazer Homes USA Inc., Hovnanian Enterprises Inc. and KB Home warned that the home-building sector is facing difficulties including cancellations and spikes in inventories.
Lereah said. “This should encourage some of the nearly 4 million people who’ve found newly created jobs over the last two years.”
AREN'T THOSE MOSTLY RE RELATED JOBS THAT WERE CREATED, WHAT ARE THEY GOING TO DO WHEN THEY LOOSE THEIR JOB BECAUSE THE BUBBLE POPPED.
you got it - 1/3 of all new jobs since 2001 were in real estate
what lereah said is so funny it's almost criminal
Copper Leaf in PHX all sold out!
http://www.trendhomes.com/cl-plat.html
NAR admits, but there's still that bullshit word - temporarily. If stays this way for 10 - 15 years, will you still call that temporary? Maybe!
Copper Leaf sold out!!Wtf.I'm gonna miss the boat again! Oh crap !OH CRAP! Is the bubble back? I don't want a cheap home cuz it ain't worth nothing.Crap ! the sky is falling again...It's PEAK LAND!Peak Land I tell you.Bahahhahhahahhahhhahhahhha!!!
OK,everyone prepare for some great opportunities to get a home in the not too distant future.Get pre approved fixed rate loan(be honest as hell about loan docs),Make offers to the banks now for 25% of debt owed on forclosures you like.Yes lowball.Negotiate the loan contract to a nats ass.Stipulate no penalties,A take over payment option at your fixed rate(this is gold if done in your favor).Bypass the broker,inform the bank of your remedies by registered mail in case of fraud or broken contract.As soon as you have a deal signed by both you and bank,start a fraud investigation,file a lien against your own property then renegotiate the contract of the loan with proffessional help.At this point you have the power to negotiate terms on your turf. You will effectively put the bank in a position of debtor.BOOM!You can enforce penalties.
If home prices go up rapidly with inflation, then the FED had to raise rates to combat inflation...
This analogy holds true after 17 times the FED raised rates to 5.25%... if the housing price goes up ... that means inflation is the present FED PROBLEM !!!!!
raise fed rates now !!!
How does this guy look at himself in the mirror without saying 'dude you are a complete liar'?
Does anyone stop to think that the NAR is just a bunch of stupid people? I've never met a smart realtor, they are just "tansaction folks" and live and die with market forces. By no way do they create the market one way or another.
I'm looking forward to the day that the whole realtor/broker methodology is revamped and we can then buy and sell houses without those stupid go betweens mucking up the transaction.
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