We all know the US and NAR home price data is pure hogwash. Now here's the CEO of one of the country's biggest banks confirming it:
The real estate market hasn't yet bottomed out, Wells Fargo & Co. Chief Executive Officer Richard Kovacevich said yesterday in an interview.
The company, the nation's biggest lender to homebuilders, expects the housing market decline to end by ``late spring.'' About a fifth of the 375 metropolitan statistical areas in the country have had home price decreases of 20 percent, he said.
``It's pretty ugly at the moment,'' Kovacevich said. Home prices are ``really down much more'' than recent economic reports suggest, he said, citing the company's internal data.
December 13, 2006
FLASH: Wells Fargo CEO says 20% of US housing markets have already crashed 20%-plus and home prices crashing much more than reported
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22 comments:
i dont know,, many other economists came out toady after seeing another increase in new mortgage applications to an 11 month high (for NEW purchases not talking refi)and said that the housing is bottoming faster then they thought-
but you can cherrypick among the world of opinions all you want
we all know housing has softened, and SOME areas were hit hard,, but going forward most supply dmand numbers have been coming in more favorably,, and even the article you rusing calls for a bottoming THIS SPRING
so there is no preciptuous drop from here, even this guy is saying that it must be starting to bottom now if the decline is over in spring (a very short time)
Why would I buy now?
Wells Fargo is probably the biggest lenders in California and if they say it's bad then it's probably worst than bad. This is not good.
Ok anon first posting you go ahead and buy now. We will see who is laughing later.
HAHHAHAHAHHAHAHAHHA
Spring of 2008 is more like it... We are still midway through the Denial Stage. We still have Fear, Desperation, Panic, Capitulation, and Despondency to go before we hit the real bottom. The Denial stage will start to be over around the 3rd week of January when the market is flooded with all these homes which were pulled off the market, placed back on. Then you have the NOD jump from people skipping mortgage payments for the holiday season...
Overall, the article is pretty upbeat about housing. But few real numbers are used. It's just like: 'mortgage applications up', 'inventories down' but they don't say by how much. None of these so-called positive indicators are strong enough to actually rely on - they are like up by half a percent.
The fact is that prices are still unaffordable without some kind of a toxic teaser rate for your first year. And since foreclosures are up several times (300% in Mass., 466% in Alabama, etc), we know that all these homes bought with toxic mortgage money are false sales - they'll be back up for sale on the courthouse steps as soon as the teaser-rate payment period expires.
What does Richard Kovacevich know said David Liar-eah. He's a dumb sounding Polish guy my research indicates.
Greg Swann agreed as did the other Realt-Whores.
Cool.
Cow_tipping.
Anonymous said...
i dont know,, many other economists came out toady after seeing another increase in new mortgage applications to an 11 month high (for NEW purchases not talking refi)and said that the housing is bottoming faster then they thought-
but you can cherrypick among the world of opinions all you want
we all know housing has softened, and SOME areas were hit hard,, but going forward most supply dmand numbers have been coming in more favorably,, and even the article you rusing calls for a bottoming THIS SPRING
so there is no preciptuous drop from here, even this guy is saying that it must be starting to bottom now if the decline is over in spring (a very short time)
Wednesday, December 13, 2006 7:49:40 PM
The question is anonymous - are you willing to put your $$$ on the line with their prediction that its appreciating in spring, when in the past they ahve said, the bottom is now, and it will go up forever, and they dont make any more land and interest rates will go up and there is no bubble. Remember, its your $$$ and your credit history and they get to walk away with their commission free and clear. If you lose the house and get foreclosed upon, they should have to get that hit on their credit history, and they should refund the commission. heck i'd hold the commission in an escrow accout and pay back to them over 5-10 years. Sorta like a put your $$$ where your mouth is.
Cool.
Cow_tipping.
yes i will put myself on the line,, you have to too though
my prediction is that NATIONAL medain prices will be flat to higher one year from now (and thats national average,, not some particular bubble area like some phoenix or ca subdivision)
and i predict that one year from now median prices will increase in at least twice as many areas then show decrease..
you can all call me an idiot if im wrong.. i look forward not backwards and the housing crash is OLD news,, not upcoming news thats all
Now could you please make YOUR prediction in writing natl median down 30%,,40% ??? whatever you think
and well see whose closer to the truth based on CURRENT trends, not what already happened
thanks, theres my prediction in writing!!!
yes i will put myself on the line,, you have to too though
my prediction is that NATIONAL medain prices will be flat to higher one year from now (and thats national average,, not some particular bubble area like some phoenix or ca subdivision)
and i predict that one year from now median prices will increase in at least twice as many areas then show decrease..
you can all call me an idiot if im wrong.. i look forward not backwards and the housing crash is OLD news,, not upcoming news thats all
Now could you please make YOUR prediction in writing natl median down 30%,,40% ??? whatever you think
and well see whose closer to the truth based on CURRENT trends, not what already happened
thanks, theres my prediction in writing!!!
and i never said anythign goes up forever,, dont put words in my mouth please,,just that supply demand has been changing since the bearish numbers earlier this year
thanks
cheny read the riot act by the saudis!
holy crap!
Anyone get the feeling it's all falling apart now and nobody can stop it?
Here's an example of how over heated the market has become. I bought a house 10yrs ago 50 miles east of Los Angeles for a little over 100K. According the zillow my house is worth between 485k to 515K. I wonder what has happen to the Cali, my house as much as i love it, I would not pay more than 200k for it today, granted since i bought the home I have sank atlest 50k into in the form of upgrades.
My nieghbor just sold his home 2 months ago for $505 k, he bought it a little over a year ago for 434K, the people who owned the house before him bought for 385k and lived in it for less than a year, the family who onwned it before them bought the house for 285K, the orginal owner bought for it for 75k back in 1975 and sold for 185k after owning the house for 22 years.
How can anyone so stupid as to pay 505k for a 4/2 peice of shit. I tel my wife all the time we should sell our house for 300k just to piss off all of our dumb as neighbors.
Any of these guys who are claiming to know a precise date or season about when the decline will end are blowing it out of their asses - wake up. The only thing of value is in this guys report or statement is about what is happening on the ground right now given his present data.
Smug
Anonymous said...
yes i will put myself on the line,, you have to too though
my prediction is that NATIONAL medain prices will be flat to higher one year from now (and thats national average,, not some particular bubble area like some phoenix or ca subdivision)
and i predict that one year from now median prices will increase in at least twice as many areas then show decrease..
you can all call me an idiot if im wrong.. i look forward not backwards and the housing crash is OLD news,, not upcoming news thats all
Now could you please make YOUR prediction in writing natl median down 30%,,40% ??? whatever you think
and well see whose closer to the truth based on CURRENT trends, not what already happened
thanks, theres my prediction in writing!!!
Wednesday, December 13, 2006 8:25:26 PM
Nice - very nice manipulation of stats.
By putting your $$ on the line I guess you would buy in a location of your choice. And me putting my $$ on the line implies ... what ???
I wont buy a house and I will buy 2008 spring - or even later - 2009 ???
Anyway stats at the national level and in fact all levels are murky due to the heavy use of incentives, and its definetly manipulated by everyone especially the NAR.
I am not calling a 30 or 40% national decrease. I just will say that predictions from the NAR are just about as valueable as yesterday's newspaper. Follow them at your own peril. They said prices will keep rising last year among many other "amazing but true" type predictions.
Now Anonymous - you are in fact anonymous, so how would we verify anything. You can simply turn around and ... disappear much like your "house appreciation".
Cool.
Cow_tipping.
why attack,
I was very clear about my prediction, and have nothing to do with NAR or here (just an ex trader who follows #'s)
again my prediction is that national median will be flat to higher in a year (not lower at all on average) and that twice as many areas will increase then decrease-
this is WAY against the grain of most hear that look for national collapse
my thoughts are based on declining inventory over the last few months in the vast majority of areas , extreme bearishness, declining yields on the 10 year note, a new housing starts to exisiting sales ratio at an all time low, and new purchase mortgage apps at a 10 year high
housing is simply like any other market and youve got to seperate bearish/bullish crowds from actual reality and statistics
current statisitcs are VERY different from those earlier this year , when i would say housing was weakining
Im an ex institutional trader that made my lliving looking at markets in this way thats all, and human behavior is similar at all peaks and bottoms
so I could care less what the NAR or bloggeres here think, Ive told you what ive based my prediciton on and was very straightforward
and if you say that any natl #'s can be manipulated, i guess its hopeless to make any prediction as youll just question the validity of the stats????what other stat would you like me to use then medain price??
I assure you , I am the least biased person here, just better trained in looking at markets then many - theres a lot of othere things I dont have a lot of experience in, markets arent one of them...and this looks like a bottomoing pattern when you look at bearish psychology in the face of changin supply and demand ( just the opposite from the internet burst when everyone was over BULLISH in the face of no earnings in these co's- now most are overBEARISH in housing in the face of changin supply/demand, and are overgeneralizing ca fl and az for exmple to justify some national crash that just is NOT happening from here)...
sorry mortgage apps at 11 month high for new purchases, (not 10 year) - typo error
anonymous at Wednesday, December 13, 2006 9:52:10 PM
Your last paragraph in your statement makes me laugh because you sound just like me.
OK here it is in other words:
There are several places that had no bubble. So in effect its not a national picture that is likely to have a large correction.
You are claiming that you would buy in spring - you dont seem to commit to a location (at the general city or county level not sub division level). So I am in a sense agreeing with you. Somewhere in the country its a good time to buy in spring with a good chance of appreciation from there on out.
Cool.
Cow_tipping.
And yea I am an old options trader as well.
Real estate is far more local than the stock market (NBBO while its not perfect does not exist in the RE world) and incentives and heavy under handed deals run the gamut.
They say Sac has only dropped 7% in price, at the same time right on the phone Dr Horton and Pulte will offer you 100,000 discount on a 400K house. Wonderful, that's the new math isn't it. Heck ... their site lists a 100K+ break on several houses and here is another one for you, they have sold 279 houses in the last 5 weeks when I saw it last. I am betting some of those sales have been returned and sold several times over.
So yes, no big nation wide drop in $$$ but bubblicious markets are just like pets.com. Poof - worth less ...
Remember - price drops are weighted with volume of sales. if prices drop drastically in a market where demand is dead (its usually the cause for a drop in $$$) that will reduce its effect on the national average. So some markets could tank completely and the national numbers will ignore it. Another region may have high sales and higher $$ and that will be over represented. What sells is what shows in the numbers. Not what is available.
Cool.
Cow_tipping.
anon,,
ok, cool - i think were in general agreement for the most part-
and i used to trade otc fx options interbank (volatility trading ) back in the 80's, so we have that in common too
take care...
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