Whew, it really would've sucked if house prices fell back their historic trendline, as gravity dictated they would. It really would've been bad if the housing price to income ratio had to make sense again. It would have been terrible if 50% of the nation's realtors, who are no longer needed, had to find new work.
Man, I'm glad that short-lived housing crash is over now in the US.
Everyone, party on! Go buy houses today, no matter what the price. The good times are here again!
The corrupt David Lereah told you so.
David Lereah, NAR’s chief economist, said modest gains are expected for home sales. “As the housing market recovers from its correction, existing-home sales should be rising gradually during 2007 – it looks like we may have reached the low point for the current cycle in September,” he said. “We’ve entered a more sustainable period of home sales now, and we expect greater support for prices over time as inventory levels are eventually drawn down.”
The slight increases in sales were not enough to halt a slide in home prices. The median price for an existing home sold in November dropped to $218,000, down 3.1 percent from the price a year ago. It was the first time on record that sales prices compared to a year ago have fallen for four straight months.
December 28, 2006
FLASH: The corrupt David Lereah declares housing crash over, we've hit bottom, it's up up and away from here!
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66 comments:
Spin Spin Spin...HPers you're gonna make yourselves sick.
Prices are up, sales up are up.
On a similar note, back in the '80's, didn't some government official declare that the energy crisis was over?
Yeah, right...
prices are up? man, I wish anon's had a name that we could mock
ROBTV, in Canada, just had an ecomomist from BMO telling us the same. In summary, he said the US housing down turn has ended and sales were improving and expected an up turn in the ecomomy next year.
Good Times Roll
Let the good times roll
Let them knock you around
Let the good times roll
Let them make you a clown
Let them leave you up in the air
Let them brush your rock and roll hair
Let the good times roll
Let the good times roll
Let the good times roll
Let the stories be cold
They can say what they want
Let the photos be old
Let them show what they want
If the illusion is real
Let them give you a ride
If they got thunder appeal
Let them be on your side
The Cars [1978]
video
hmmmm, I shouldn't have pissed off my realtor who I asked to stop sending me emails because I told him "your services aren't free, they'll be part of my mortgage" after he told me "don't hesitate to use me, I'm free."
Too bad hanukah has come and gone otherwise a "Spin the dradle" post would have worked well.
Y'all keep spinning now. Sales aren't up. Prices aren't up. No, no no. All NAR and government conspiracies don't you know.
CNCB is wrong
CNN is wrong
WSJ is wrong
NY Times is wrong
Only HP is right.
I can't wait till Feb when you spin 3 months of increases, should be fun to watch.
Never hesitate to utilize Realtorspeak. Always spin the positive. Spin the negative up. Everything is up. Never a downside. Eventually it will become truth.
Orwell Realty. Established 1984
Yes, quite frankly, on this matter, only HP and the bubble blogs are reporting the truth.
Reality: Housing not so good, maybe starting to get better, time will tell
1% of extremists on one end: Housing is awesome 20% appreciation next year, BUY BUY BUY
1% of extremists on the other end: this is the worst ever, 40% crash, boy I'm glad I'm renting
Yes Keith you are in good company
Nice!!!! I am going to a realtor's office today to see if there is any inventory for sale.
You know what they say
"If you don't get in now you will be priced out FOREVER!"
To funny!
you mean too funny?
Your literacy skills continue to amaze me.
you mean too funny?
Your literacy skills continue to amaze me.
---------
STFU! Douche bag, go teach your English Grammar skills somewhere else.
Your literacy skills continue to amaze me.
-------
You know what amazes me? That you would actually take time to proof read a post..What a wasted life.
Just returned from Phoenix and have to say things there seemed pretty robust. Still building homes like there is no tomorrow, you'd think there would be a complete cessation of new building, but not!
Prices seem to be coming down FINALLY there, but not by the amounts people here want. New builders were not offering any bargains. Stopped by a few places out in the West Valley (Litchfield Park) and homes were still pricey even by 2004 standards. Homes were still selling and I was amazed at how many lots were SOLD.
Driving around didn't see as many For Sale Signs as I expected and there were still houses with SOLD on them. Especially in the Central City, WILLOW DIstrict for example where small 1400 sq ft homes are still selling for $380-520,000, off from the $425-650,000 at the peak of 2005 but still way higher than the $225,000 you'd have paid in 2001.
I expected not a single SOLD sign on my drives around town. Seems to be way too much commercial space being built too and friends I spoke with expect prices to stagnate or come down slightly but don't care since they bought long ago.
So if Phoenix is ground Zero, I'm confused.
Also Arizona over took Nevada for the fastest growing state so as long as population continues to migrate to Phoenix that inventory of homes should be absorbed quickly and the builders will continue their obscene building, and as much as HP and others cry BUBBLE in Phoenix 2006 is still headed to be the FOURTH best year ever for Phoenix, so as always, you got to put trends and statistics in perspective.
A decline over 2005 doesn't mean the bubble burst. I think home prices there are high but when one takes the low state income tax and low property tax rate many folk who do move there still find the over-all cost of living lower.
That being said, there is a good chance, as long as we don't nuke Iran, that mid-2007 should show a modest uptick in the market as rates are still historically low.
I believe there is a massive bubble in all assets, derivitaves, stocks, home values world wide but it appears that the powers that be intend to keep it that way for a little while longer.
Foxwood,
Let me predict the next 10 replies to your post:
1. You must be an NAR shill.
2. You are stupid.
3. Shut up.
4. Don't you know 2007 will see a
40% crash which is only the
begining?
5. Anyone who owns anything in
Phoenix is so screwed.
6. You don't actually believe
population statistics do you?
It's all a government lie. AZ is
losing population, I read it
online.
7. Too many jews in Phoenix, no way
anyone wants to live there.
8. Phoenix? Are you crazy. It's hot
in Phoenix, no way anyone wants
to move there.
9. $400K for a home? Pfff. No way
any home is worth more than 1997
prices which were $112K.
10. Phoenix? With all those
illegals? Who the hell wants to
live there?
For this to have any meanin you'd have to assume that the cancel rate increased more than 3% between Oct and Nov. If cancel rate is/was 40% in both months and the sales number is up month.
brokersleaveyoubroke said...
New home sales are up 3% over last month but the government figures don't include cancellations which are running 40%. I guess HP readers are the only people smart enough to figure out that sales are really down when the MSM publishes misleading numbers out of context. Oh, and the small price gain doesn't include the incentives that knock about 25% off the price.
EXAMPLE:
October:
1000 sales
600 sales after cancelations:
40% cancel rate
November:
1030 sales
618 sales after cancellations
40% cancel rate
Sales actually declined only if the cancellation rate is 42% or higher.
As for the supposed 25% discount in incentives? Get real.
1. On a $500K home that means $125K. Jezuz, $125K of upgrades? No way. There is only so much tile/hardwood and upgraded kitchen counters you can put in a home. Unless they'r importing Italian marble for KB homes, you ain't gettin no $125K worth of upgrades.
2. Even at the peak market builders were still giving away incentives to use their lender. When I was looking at new new homes it was between $5-10K either in closing costs or upgrades.
3. When you see a sig saying $50K in FREE UPGRADES, do you really think it is $50K? When you see a commercial for Sears that says, 20% off everything in the store, do you really thing you're really getting 20% off? That $50K in "FREE" upgrades probably cost $20K a year ago. What the builders did was take those $20K worth of flooring/tile etc off the upgrade list available and instead "give it away for free".
This is no different than a car dealer adding $1200 to the sticker for the desert protection package in Arizona or the Hurricane protection package in Florida. That package is really an extra coat of wax and window tinting. Then the dealer "gives it for free" and the moron buyer thinks he just saved $1200.
Foxwood said
"Just returned from Phoenix and have to say things there seemed pretty robust. Still building homes like there is no tomorrow, you'd think there would be a complete cessation of new building, but not!"
I am in awe of the number of people who will post, most having never been to Phoenix or have any knowledge other than internet blogs. He may well be correct, if your there and disagree, take a picture of todays newpaper, post it so we know you are actually in Phoenix, then maybe you'll gain some credibility.
Sitting here in Florida, I'm seeing most shitbox mortgage/realtors going out of business, while the pros will be left to eat there lunch when this market turns...cant wait...actually can wait, cus I sold off everything except my primary and a beach cottage, and put 100 k away.
The only market anyone can intelligently post about is the one they actuall live in...but fell free to rant away, it is great entertainment.
Florida Gator
Seems to me there are a lot of touchy anonymous trolls today. More than usual. Perhaps it's because despite all of the great news being reported, realtors still can't sell anything.
"Yes, but wrong may be a bit too harsh. They're not right or wrong, they're just printing the numbers that were fed to them. They should just do a better job of putting those numbers into perspective. For instance, the 3% sales gain is based on a very small sample and is always revised in the following month. Also, the year over year sales are down double digits so that 3% is meaningless. "
And median price is useless in some markets, because people chose to bulldoze old shit boxes on the beach and build houses 3-5 times the size...
EXAMPLE:
1. Blah
2. Blah Blah
3. Blah Blah Blah
Always utilize Realtorspeak to insult the naysayers. Attack the messengers trying to enlighten the masses away from the Victory Bubble.
Orwell Realty. Established 1984
To the anon that sarcastically wrote the MSM must have it wrong and only HP has it right. Most of the media companies you mentioned have done reports on both sides of the housing issue. You apparently only see what you want to see. Keith just posted yesterday an article done by the WSJ on housing blogs. Just today, the NYT reported on the fabulous housing numbers. Just a few quotes from their article: "The Mortgage Banker's Associate says...loan applications have dropped to the lowest level in four months", "incentives are not included in the home price data", "Northeast sales fell 42.4% from a year ago", if the prices weren't seasonally adjusted for Thanksgiving - we would have seen a drop, not an increase in sales. There may be a little bleep in the radar as those Wall Street Execs get their bonuses. Since some of them can't get their Ferrari's they might rest it in RE. But I won't buy until prices come back in line with salaries http://tinyurl.com/ylprm4
OK ignore reality. Sales didn't go up 3%. They actually went down 19982% and the median price is now really $9.45 after incentives.
In wingnut land, whatever reality you want you can have.
---------------------------------
EXAMPLE:
1. Blah
2. Blah Blah
3. Blah Blah Blah
Always utilize Realtorspeak to insult the naysayers. Attack the messengers trying to enlighten the masses away from the Victory Bubble.
Orwell Realty. Established 1984
LOL!!!
Sounds like someone NEVER learned that even a dead cat will bounce when dropped from a VERY great height...
You don't see 25% yourself, you see 10%. You think you read 25%. So why did you say 25% then?
And no I don't go looking for houses, I have better things to do.
"I guess you don't go out looking at new houses. 10% upgrades or cash back is common around here and that was unheard of before early 2005. I think I read about the 25% in the LA times, I'll look for a link. I don't see 25% around here but I see enough to know the price increase figures are totally bogus.."
It is OK to ignore reality when it serves Big Brother's interests.
But NEVER lose your cool.
NEVER utilize Realtorspeak to attack fellow Realtors. Showing dissention will embolden the masses.
Never forget, it is the masses who hold the real power. Realtors must stick together in the Victory Bubble, or perish.
Orwell realty. Established 1984
Other realities in wingnut land that the MSM won't tell you...if you think sales didn't really go up last month.
December isn't really colder than November. The MSM says it's colder in December than November. average temp this Nov was 55. Average temp this December was 46. According to the MSM liars, they'd have you believe December is colder. Smart HP wingnuts realize that since last year Dec temp was 46 it really means December is hotter than November.
You weigh less, but you really gained weight
In Dec '05 the average HP wingut weighed 325 lbs. By November he weighed 350. He lost 10 lbs this month dropping him to 340. The MSM would have you believe the wingnut lost weight this month. In reality the wingnut gained 15 lbs YOY making the MSM liars.
Tell me wingnuts, in your world is it dark at night?
Thought Police.
"Seems to me there are a lot of touchy anonymous trolls today. More than usual. Perhaps it's because despite all of the great news being reported, realtors still can't sell anything"
you just posted this comment anonymously? and wtf is a wingnut?
To Florida Gator and Annoymous who responded to my post, thanks for your imput.
First to FLORIDA GATOR. I don't recognize your identity but for most who have followed me for the past year, I recently moved from Phoenix to Austin. I lived in Phoenix a total of sixteen years (lived there twice) and my wife lived there three times for a total of 20 years. Most of our friends live there so we visit and we were last in Phoenix in April prior to our move to Austin. My wife was homesick and wanted to go back to see if she wanted to move back so the trip was a fact finding trip.
We also lived in Florida, Homestead, Tampa/St Pet four times as we were in the Air Force and stationed there and Phoenix. I love Tampa, my wife hates the tropics so the desert was our compromise until now, when we came to the Texas hill country though my wife would return to Vancouver, BC if she could talk me into it. So, when I comment on Phoenix I do so from experience, not just reading about it in the paper or on a blog. Read below for comments to annonymous, though I wish these annoymous bloggers would at least identify themselves somehow in their posts by saying, "annonymous San Diego" or such as there is no way to link one with the other.
Annonymous said, "Let me predict the next 10 replies to your post:
1. You must be an NAR shill.
No, I have no connection with Real Estate other than being a homeowner and I assume you are either Richard posting as annonymous (he does that) or the usual Annonymous who, without knowing where he lives or such, frequently seems annoyed by anything I post. Those who follow my posts know quite a bit about who I am, what I do for a living, where I have lived etc.
2. You are stupid.
Hardly. I have tested in the top 5% for IQ, I have an extensive educational background starting with having been a seminary student fresh out of high school to a background in aeronautics and medicine. I am no NAR expert but I have followed real estate trends for 30 years and have never overpaid or lost money on real estate and have lived through three real estate cycles and seen the ups and downs, bubbles and crashes, low interest rates and very high interest rates.
3. Shut up.
Why? Speech is a protected American right.
4. Don't you know 2007 will see a
40% crash which is only the
begining?
Maybe. They've been saying Jesus was coming back for 2000 years, still waiting. I'm still out on when or if there will be a crash (and of course that depends on the definition of crash doesn't it?). I've been waiting for a crash since 1999. Still waiting. Doesn't mean I haven't bought a home, actually have bought four homes since then as there are always bargains, I always follow the rules of value and never buy what I can't afford.
5. Anyone who owns anything in
Phoenix is so screwed.
Hardly. Sorry if you are in debt. Most of my friends are between 45-65 and all very well established and own homes in Phoenix they bought long before the 2004-2005 bubble. Several own rentals, either close to being paid off or owing less than $120,000 on them and all have either paid off their primary residences or will have them paid off long before they are retired. Oh, and most are military retired so started drawing pensions at 42 and still have a good 15 years to go to retire with SSI and have good jobs.
6. You don't actually believe
population statistics do you?
Don't you? Look around? Does it look like the population is shrinking? One reason I moved from Phoenix to Austin, to live in a smaller community.
It's all a government lie. AZ is
losing population, I read it
online.
Well, we all know that everything you read online is true, just listen to Honica. Yes, Arizona is now the leader in population growth, does that mean they are gaining the most people? No. Texas is but since there are 23.5 million here then the number of new residents as a percentage of that number means that they can have twice as many people move here and yet Arizona would still rank higher for percentage growth. The population of the USA has doubled since I was a kid.
7. Too many jews in Phoenix, no way
anyone wants to live there.
Yes, I have lots of jewish friends there. Lots of jews work in the medical field and we should be grateful for their skills. If you want to follow the money as they say, follow the jews. Also, if you have followed my posts you'd know that my ancestry contains jews though they converted over 100 years ago to Christianity.
8. Phoenix? Are you crazy. It's hot
in Phoenix, no way anyone wants
to move there.
Apparently they do or Phoenix wouldn't have doubled in size in 20 years. With global warming it is hot a lot of places these days. My wife likes the heat of the desert over that of say New Orleans.
9. $400K for a home? Pfff. No way
any home is worth more than 1997
prices which were $112K.
Depends on what you bought. I agree, most of the homes currently selling for $225,000 are not worth $112,000. My friends rental, their first home bought in the west valley in 1982 for $67,000 I wouldn't give them $100,000 for, but what I'd pay and what someone else would pay is relative. There are quite a few homes I'd pay $400,000 for in Phoenix...problem is they currently want $1,000,000 for them.
10. Phoenix? With all those
illegals? Who the hell wants to
live there?
Have you taken a look at California? I say who'd want to live there and I was born there.
Phoenix is a dynamic and growing city. It is the economic power of the region. It is a relatively new, clean, city. It has good infrastructure, good roads, diverse economy, good weather even if the summers are too long for me. I could still see myself living there if prices were back to say 2002 prices but we left for other reason than just the price of a house.
Hope that clarifies some of your points. And as you should know if you've followed what I've posted I do believe the fundamentals of our market is out of whack and home values unsustainable in many major cities and even small towns. I believe our economy is being sold down the drain to countries like China for corporate profits and that modern CEOs and the rich have forgotten what brought about the socialist revolution in many countries.
That being said, I still find that the anticipated crash hasn't arrived...yet. That our market may have more room for expansion based on the experience of South Africa, Australia, Spain, Britain, Ireland, France, to name a few countries whose home values have risen much higher than ours and whose economies are much smaller.
I hope the steam has been let out. I hope prices don't return to ridiculous rates of appreciaton. I don't wish for a GREAT DEPRESSION nor do I believe that those who want a 40% drop or more in prices will benefit if it happened as an implosion would lead to massive unemployment and hardship and those who can't afford to buy now won't be able to then and those who can afford to buy now will then be able to buy even more as they did during the Great Depression of the 30s.
I do believe there are some markets that will feel pain, especially those idiot Californians who started this bubble.
foxwood,
I was the one who posted the Top 10 list. Dude, lighten up. I was being sarcastic and predicting what the wingnuts here would say based on their biased, knee-jerk comments to any post even mildly entertaining the possibility that things aren't THAT bad.
I agree with almost your entire analysis original analysis.
Sheesh everyone is so on edge.
Who are you going to believe, me or your lying eyes?
Plunk down cash to a builder for a brand new home, when the builder can go BK due to the downturn, before your house is complete?
Buy a house now, when your job is in construction, realty, or mortgage related?
Speculate on real estate, when real estate is losing money?
Ignore the sentinal cities, and think that the tsunami will pass your bubble city?
All Bubbles Pop.
The sale of my home is part of today's existing home sale data which is being hailed as vindicating both sides of this bubble debate. But while your debating the cold, facial "quantitative" aspect of the numbers here is the qualitative aspect of one of those numbers:
I took a 65k bath b/t the appliances/upgades I left behind, the commissions and the price cuts I made just to sell the place. I had to do this to compete with developers tossing in everything to move excess inventory. Otherwise I'd still be paying 2-3k a month for an empty house I'd visit on the weekends plus rent on an apartment in the city were I now work. All the other seller/owners in my plan are still clinging to higher prices.
That is what it takes to sell a home, its not a normal market, its not stabilizing and its just not a buyer's market, it a buyer's revenge market and its going to get worse before it gets better.
I am delaying many purchases, cutting back everywhere I can and hawking stuff on e-bay to just fill the financial void caused by the loss. This financial tragedy will be repeated over thousand of times in near future with varying degrees of financial pain. Anyone that thinks this is not going to impact the economy has their head up their a$$. This is bad, this is real and its going to hurt alot of people for a very long time.
sure, it is bottomed out, look free houses
145000 NO MONEY NEEDED! (Broward)
from the ft lauderdale craigs list btw...
sheesh
I was the one who posted the Top 10 list. Dude, lighten up. I was being sarcastic and predicting what the wingnuts here would say based on their biased, knee-jerk comments to any post even mildly entertaining the possibility that things aren't THAT bad.
I agree with almost your entire analysis original analysis.
Thanks for the input Annonymous. I missed the sarcasim but do agree with you about those who get upset if you disagree that things aren't totally bad.
As you, and others know, I try to be balanced because I don't know the hell what the future holds and experience has taught me that in the short term it is difficult to know since there will always be factors we don't know about, factors we can't control, and facts that will confound us. I've always thought houses too expensive....for thirty years! And still I'm confounded and proven wrong. The only thing I can do is exercise caution, try to buy in the middle, buy what I can afford, and hope for the best.
The economy over the past 20 years continues to baffle me. The housing market continues to baffle me. I know that there are a lot of folks worse off than me and a lot of folks better off than me and am thankful that I have a good career, money in the bank so I can take a year off work and not stress, still own a house, travel, and such. I still worry about retirement as I don't know what the future holds. Our government might be bankrupt, the stock market could crash, we could go into a global depression, we could get hit by an asteroid, a super volcano could erupt, a nuclear war, who knows.
But you're right, say anything remotely saying the end hasn't come...yet, or that it may turn into a slow leak, or that there may still be some room for another idiotic spurt in home prices and you get bashed.
I've had enough of that type of treatment from fundamentalists for not agreeing that every earthquake, tsunami, war, famine, etc portends the end of the world instead of the normal course of human existence.
foxwood,
I replied to your long post and for some reason Keith deleted me.
Huh, go figure, I dared to have a dissenting opinion.
Yes, people seem a bit testy, let's focus on DL, our common enemy. Seriously, I can't believe that no one pointed out the following: In the spin article it seems to me that the year over year decline in prices is the largest EVER reported. I'm not sure, but I thought the 2.5 percent reported for October 2006 yoy was at that time the largest drop recorded. Can anybody verify this? Thanks. I am a huge bear, but even I am surprised at how quickly these yoy price drops are accelerating (esp. considering how phony the numbers are regarding sellers crediting for repairs, closing costs, and just the privelige of buyer's taking property off of our hands)
Foxwood, I agree that there is a big bubble. I also agree that the evidence that this bubble is popping is currently equivocal, it's inconclusive. I would say the same about your observations in Phoenix.
The evidence you gave is anecdotal and inconclusive. We expect the anecdotal evidence and the empirical evidence to point to a declining housing market and sometimes that's not the case. But even if the bubble is popping there still should be some 'sold' signs. Maybe it's sort of like when someone tells you that a movie is really great but when you see it you aren't that impressed, not because it's not a good movie but just because your expectations were too high.
I think we should all have some fear that the fed, the reic, somebody has one more trick up their sleeve that will further postpone the inevitable popping of this bubble. But I think there is too much risk in this market to allow a cautious and prudent person to make a decision to buy a home right now.
We are still waiting for Godot.
Look. Crudely put, a 3% drop in price means a 3% increase in sales. But "sales" are irrelevant. I don't care how many houses sell, I only want the prices to come down to be affordable.
A drop in prices means speculative demand is gone. The reason prices rose fast is gone. 3% price loss per month x 12 months = 36% drop (well, do a reverse compound interest, it's a little less) in price per year.
That's a crash.
C-R-A-S-H. So stop whining about how long it's going to take. It's happening right now. If you buy now you completely deserve what happens to you.
A lot of people are under the illusion that those at the top know what they are doing. If that were true, would we have had the NASDAQ crash? Would we be involved in an Iraq Quagmire? When things go to hell like they did in New Orleans, are you expecting the gubmint to bail you out?
I'm afraid the people at the top are no better than average. Right now the dollar is being raped and pillaged by the bankers and politicians. The country's wealth is being plundered. Everyone is out for themselves (except for Cramer who is there trying to help the common man!).
Better take care of yourselves. Keep your eyes and ears open and realize mortgage brokers don't give a hoot about your financial future as once you get that loan, they get their cut and are no longer responsible for what happens to you.
At this point, talking about it is useless. Prices are coming down (existing homes) so there is certainly no reason renters need to "get in before they are priced out".
What will happen will happen.
Discussing what will happen is entertaining but you shouldn't take it too seriously. It makes no difference what we say here. The laws of economics, politics, psychology and physics en masse will determine the outcome.
P.S. Anyone who bought after Jan 2005 in the bubble cities is screwed. Kiss your entire financial future goodbye.
brokersleaveyoubroke said...
New home sales are up 3% over last month but the government figures don't include cancellations which are running 40%.
-------------------
Oh.....ooops!
From MSNBC.com
Vote: Is worst over for housing?
Make your opinion heard !!!
Opinion from Gene Sperling, author of ``The Pro-Growth Progressive,'' and was President Bill Clinton's top economic adviser. He is a senior fellow at the Center for American Progress....
The problem is that none of the bulls seem to have a good answer to the facts being laid out by David Rosenberg, the chief economist for North America at Merrill Lynch & Co. Rosenberg's contention is that when you take a close look at homes for sale, including those being completed and those under construction, the glut in supply seems likely to get worse, not better.
Building Inventory
In a Nov. 27 comment, Rosenberg notes that in addition to the record 4.3 million residential units for sale as of October, there were 1.95 million home completions, the 12th-highest month since 1979. Units under construction were through the roof as well. Rather than seeing supply dwindle and prices start to firm up in early 2007, Rosenberg says ``it could be a year before the reduction in starts begins to put a meaningful dent into the inventory backlog.''
John Mauldin, an investment adviser and frequent contributor to Investors Insight, a financial-data publisher, throws an extra log on the fire. According to Mauldin, even the current projection of housing sales may be overstated and thus the existing supply of homes greater than what is reported in the official data. The reason is that the Census Bureau, one of the Commerce Department's statistical agencies, fails to account for cancellations in home sales contracts. Cancellations ran as high as 40 percent for some major homebuilding firms last quarter.
Triple Threat
If the bearish view on home inventories is true, it poses a triple threat next year.
http://preview.tinyurl.com/ydxhmf
wingnuts
---------
New word of the day....must have overheard that word while taking orders and Burger King.
I'm laughing at you but I'm not angry. I have no reason to be. My home is worth almost 3 times more than what I paid for it. It's gone down in price 5-10%, may go another 5-10%. No disagreement there.
I do laught at you at the 50% predictions. I laugh at you at the Global Depression 2012 (DP2010 as someone trademarked it). I laugh at you for thinking Ben Bernake has some sercret plan to hyperinflate the economy so that we can join the Amero. I laugh at you because you can't see that hyperinflation and a Global Depression are mutually exclusive. I laugh at you because you people think the jews are behind everything. I laugh at you because on the one hand Bush is an idiot who can't tie his shoes, but on the other he is masterminded this housing bubble in an effort to speed up enrance into the NAU.
And I am laughing at you because you ignore any evidence that you are wrong. Sales up? Well no they aren't because blah blah blah. Prices up? Well no they aren't because blah blah blah.
---------------------------
Right now people who were laughing at us are now the angry ones. I'm not angry, I'm laughing because what I said would happen is happening. People who bought more house than they could afford with a timebomb loan are the angry ones now.
The ones who are getting angry are the ones who emptied their pockets trying to get the one in that wins.
wingnut
(noun) A person appearing to be moderately to severely crazy, disoriented, majobling, see Majoble, jumbled and more often than not, a total mess. A wingnut is a constant source of entertainment to those surrounding it and can easily be found in any type of setting or venue.
And median price is useless in some markets, because people chose to bulldoze old shit boxes on the beach and build houses 3-5 times the size...
Thursday, December 28, 2006 10:37:48 PM
-----------------
Buying a median priced house in Chicago will get you free incentives of stray bullets flying thru your wndows!!!
bozonian said...
A lot of people are under the illusion that those at the top know what they are doing. If that were true, would we have had the NASDAQ crash? Would we be involved in an Iraq Quagmire?
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your assumption is that those things are BAD things.....
HUH?
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And median price is useless in some
markets, because people chose to bulldoze old shit boxes on the beach and build houses 3-5 times the size...
I have 5 houses.
$100,000
$125,000
$135,000
$155,000
$165,000
Median is $135,000
I bulldoze the bottom 3 shit boxes and build beach home worth 3 times a smuch
$155,000 shit box
$165,000 shit box
$495,000 beach home
New median is $165,000. Why is median price irrelevant?
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And median price is useless in some markets, because people chose to bulldoze old shit boxes on the beach and build houses 3-5 times the size...
Thanks for the input Annonymous. I missed the sarcasim but do agree with you about those who get upset if you disagree that things aren't totally bad.
As you, and others know, I try to be balanced because I don't know the hell what the future holds and experience has taught me that in the short term it is difficult to know since there will always be factors we don't know about, factors we can't control, and facts that will confound us. I've always thought houses too expensive....for thirty years! And still I'm confounded and proven wrong. The only thing I can do is exercise caution, try to buy in the middle, buy what I can afford, and hope for the best.
The economy over the past 20 years continues to baffle me. The housing market continues to baffle me. I know that there are a lot of folks worse off than me and a lot of folks better off than me and am thankful that I have a good career, money in the bank so I can take a year off work and not stress, still own a house, travel, and such. I still worry about retirement as I don't know what the future holds. Our government might be bankrupt, the stock market could crash, we could go into a global depression, we could get hit by an asteroid, a super volcano could erupt, a nuclear war, who knows.
But you're right, say anything remotely saying the end hasn't come...yet, or that it may turn into a slow leak, or that there may still be some room for another idiotic spurt in home prices and you get bashed.
I've had enough of that type of treatment from fundamentalists for not agreeing that every earthquake, tsunami, war, famine, etc portends the end of the world instead of the normal course of human existence.
Paul E. Math, a wise man.
I agree that our observations are flawed. Sort of like picking up a glass of soda expecting root beer and tasting coke, it shocks the senses because we expected one thing and got another.
History is ripe with examples of people seeing the signs and misreading them. Back in 1844 many people felt all the signs showed the end of the world. Many people followed the interpretation of those signs (Millerites) and put on their white robes, climbed on their rooftops and waited for the second coming. When morning appeared and they were still there they jumped to their deaths. Miller was confused, so was his followers, so he went back and low and behold he misread not the signs but their meaning and came up with a "spiritual" interpretation of Jesus entering the Holy of Holies and thus the Seventh Day Adventists were born, others didn't agree and the Russelites were born and later became Jehovah Witnesses.
Today many say the signs of Israel's birth in a day in 1948 was THE SIGN of all signs to start the clock. THey point to the European Union, the increase in knowledge, the ability of the world to see the two witnesses dead in the streets of Jerusalem for three days (via internet, tv) so believe that prophecy could only come to fruition in our generation, wars, rumours of wars, famines, earthquakes of increasing frequency and intensity, tsunami, hurricanes, plague like Aids, Ebola etc and believe those signs will end in a certain event and that the signs are irrefutable.
Well, we know from history that this chain of events has played out many times from the destruction of the Temple in Jerusalem in 70ad to the first millenium, the black plague, the sacking of Rome, WWI, WWII, the 1967 war in Israel, and on and on. only to still be here.
So it is with the world economy, the world housing bubble, the world asset explosion. We see the signs, we know they mean something, we even interpret them by our personal dogma but until they happen we really don't know. We like to put order into chaos, like seeing the big dipper out of a pattern of random stars or reading Nostradamus and then saying his quatrains refered to Hitler (Hister which really was the Danube) or 9/11 or the death of a french king but if those readings were so clear we could have stopped those events.
I'm just honest enough to say that I don't know what the future holds. I guess for religous folk (which I am not) they should follow their scriptures and not predict as one who predicts and is wrong is a false prophet and subject to death!
As I mentioned, 30 years I've thought home values obscene and in major markets over-valued and bubblicious only to see the cycles repeat and prices go higher (and I agree with an earlier post that it is an illusion as I am a firm believer that intrinsic value never changes, only what one will offer up for it in paper, food, labor etc).
Keep posting your wise thoughts Math man.
House prices up ahahahah....those were national figures I believe. Anyway PHX is not up and I will give you specific examples.
Go to a community called Montelene in Queen Creek or Province in Maricopa. Both are offering 100K in price cuts. That's right just take 100K off the price!
I've been too a few other new build communities where the sales office lot plan has a bunch of sold signs over lots. There were 12 lots sold out of the 15 that were open. I told the salesperson that I was interested in making a cash offer on a spec. She pointed at 9 of the 12 sold signs and ssked me which one I would like to make an offer on. Turns out quite a few of those sold signs are specs or specs waiting to happen. She said most of the sold signs were buyers that were still waiting to sell their resale homes.
In other words, 9 out of those 12 sold signs are cancellations. I don't pay no mind to any community that says they are sold out or almost sold out. I always ask how many of these homes have actually closed. These days that question makes the sales people stutter quite a bit.
THERE IS NO WAY PRICES IN PHX WILL GO UP IN 2007. If you believe that then your blind!
Interest rates will creep up and as that happens prices WILL come down. NO if's ands or buts about it.
If you think prices will go up please tell me why or how. Are there several hundred thousand high paying jobs moving to the PHX area? Don't think so. Are salaries in PHX getting a big boost in 2007. Please!
Let's keep in mind that in the late 90's during the dotcom boom, hundreds of thousands of people flocked into the Silicon Valley area. There was no big housing shortage or super appreciation in the housing market.
When the dotcom crashed, 250K plus jobs were lost in that same area and tons of people left the area. There was no housing price crash to speak of because of this.
This proves that there could be a huge shift in population without it affecting the housing market.
Anyway, I doubt that PHX is getting that big an influx of people anymore. People moved here for ONE reason (and no it isn't the weather), affordability. It's what brought me here. People can deal with the hellish summers, the rancid pollution (smog), the lack of culture, mini malls / neighborhoods / homes that look the same no matter what part of the valley your in and all the DAMN midwestern white republicans who all look alike and all the illegals, only if this place is AFFORDABLE.
But if the PHX is unaffordable, then we may as well live in Cali. If we have to deal with unaffordability, we may as well have the beach, the culture and the REAL nice weather.
So this is the new spin today....house sales are up nationally, but it doesn't mean anything because it's hot and smoggy in Phoenix and nobody will move there anymore.
OK. yesterday it was housing sales aren't up at all. Today you at least aknowledge that sales are up.
Getting closer to reality wingnuts, by next week you might ger there.
Son, are you high?
Santa Clara County's median price in 1995 was $292,000. In 2000 it was $554,000. No appreciation huh?
Do you people just make this stuff up as you go along?
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Let's keep in mind that in the late 90's during the dotcom boom, hundreds of thousands of people flocked into the Silicon Valley area. There was no big housing shortage or super appreciation in the housing market.
Anonymous said...
I'm laughing at you but I'm not angry. I have no reason to be. My home is worth almost 3 times more than what I paid for it.
try selling it then tough guy
Annonymous asked, "you think prices will go up please tell me why or how. Are there several hundred thousand high paying jobs moving to the PHX area? Don't think so. Are salaries in PHX getting a big boost in 2007. Please!"
Well, yes, wages will go up. They just raised the minimum wage so that will filter up to all workers. You also asked about people moving there? Still are. Arizona moved up to number One in percentage of population increase barely edging out LV. Both states are still growing.
He also said, "When the dotcom crashed, 250K plus jobs were lost in that same area and tons of people left the area. There was no housing price crash to speak of because of this."
I recall visiting my parent's and noticed the decrease in traffic to SF. It was almost like when I grew up before Silcon Valley destroyed a nice, quiet, agricultural town. But point made. Sure wish I had bought a house there in 2000! Prop 13 will always keep California home prices high.
Also about bargains in Phoenix. Yes, if you go out to Maricopa or Casa Grande (technically part of the metro area) or far west, but in Central Phoenix or the most desired areas you aren't seeing those kind of price reductions. Just because a store has a fire sale on chicken doesn't mean that all meat is selling at a major discount.
But agree, Phoenix has lost its competive edge and migration will slow until that edge is restored. That is why I moved.
Anyone here wish they'd bouught a home in Phoenix in 1989 just before the last housing downturn? The median then was $78K and I'll bet the HPers of the day screamed that it was insane to pay that much for a home.
Let's see, by now you'd be 12 years away from outright ownership. The mortgage payment would be $650 a month and the home would be worth $275,000.
A complete and utter financial disaster.
Yes Annonymous! My wife returned to Phoenix in 1989 and I was still in the AF in another location and couldn't talk her into buying then as she felt insecure with me living elsewhere and wanted to wait until we were stationed back together. Well she found a house in Del Norte in Central Phoenix for $23,000 and wouldn't buy! I came to visit and found a nice house right off Central and Willetta on a double lot for $45,000, cute japanese bungalow and she wouldn't buy...said she was afraid to live in a house alone while I was away...the first house is now worth (taking a 30% reduction from 2005 prices) of $224,000, the second over $440,000. We didn't buy in Phoenix until I came back from Saudi Arabia in 1992 and she didn't want to pay $110,000 for a house in the same neighborhood as the houses above (far cry more than in 1989) so we bought in Moon Valley for $138,000 since the house was twice the size. We sold a year later for $154,000 and moved downtown and paid $62,000 for a smaller home and less of a drive to our jobs. The moon Valley house was selling for $$550,000 last year, not sure of what it is now but definitely more than what we sold it for and the small house downtown we sold in 2000 for $140,000 as I thought the market was a bubble and that that price ($138 a sq ft) was excessive. It sold in December of 2005 for $230,000 and again in October of 2006 for $238,000...note post 2005 bubble and a recent sale.
Goes to show we just don't know. I''m a classic example of a guy who BELIEVES in bubbles and have waited THIRTY YEARS for a major correction, saw two periods I thought were corrections and then prices shot through the moon again. So what do I know? Nothing. What have I learned? Even in bad markets, over-priced markets, bubbles there are still bargains. Buy the bargain, don't get in over your head, buy to live in not flip, and it seems you'll surive.
http://www.housingtracker.net/
old_housingtracker/location/Nevada/LasVegas/
Median price steady at $329,000 since 11/14. Before that the median was falling every 1-2 weeks.
Inventory is down 2000 from 23,700 to 21,700 an 8.4% drop since 11/1. Before that it was flat or increasing every week from January on.
I know, I know YOY. Still when every week prices are falling, 6 weeks of no falling is significant.
If median stays at $329+ through January the worst is over.
8 weeks, not 6
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