September 05, 2007

HousingPANIC realtor Facing Reality Quote of the Day

"Now we only have one third of the eligible buyers that we had before, and five times as many houses"

(X * 33%) + (Y * 500%) = Oh, Crap!

- Kim Dicce, realtor in Housing-Crash-Central-Tampa, who hopefully will now go home and figure out what this math means to home prices, and her profession


Debbie said...

ok this is great. I read the quote as:

Now we only have one third the GULLIBLE buyers that we had before...

Anonymous said...

Gee ya think thats why we have over a year's supply of homes and getting worse?

Econ_E said...

I have a great realtor quote for you from the Feb 4th Seattle Times.

"Steve Paoli, a real-estate broker who represents 5th and Madison, doesn't recommend a 30-year fixed mortgage to clients. "Condos might be more like cars," Paoli says. "You enjoy it. You drive it around for two, three, five years and try something new."

WHAT!!! he doesn't recommend a 30 year fixed mortgage to clients?! Aren't ARMs one of the culprits in creating the bubble after all?!

And if condos are more like cars then does that mean that they depreciate 30% as soon as you drive them off the lot?

I think that this would make a great realtor quote post Keith.

Here is the tinyurl to the original Seattle times story.

The downtown Seattle Condo market is toast. I'm surprised you haven't paid more attention to it.

Anonymous said...

What's worse is that the number of folks who can get approved has drastically shrunken. Far worse than what she says.

BigRock said...

This is a quote that everyone in the Boston area needs to hear.

Inventory has gone up but not as fast as other areas, but the potential buyers have gone way down, and of course the Massachusetts Association of Realtors doesn't look at potential buyers numbers at all.

Anonymous said...

The government will start putting renters into concentration camps until they get in on the debt game. Who do you think you are, not borrowing at least $500,000 from the banks?

Anonymous said...

Pending Home Sales Hit 6-Year Low
Wednesday September 5, 10:05 am ET
Pending Home Sales Fell in July to Lowest Level Since September 2001

WASHINGTON (AP) -- Pending sales of existing homes fell in July to the lowest level in nearly six years as the mortgage market's troubles made it tough for many borrowers to finalize home purchases.

Anonymous said...

That pending number is M-O-M and is for JULY not August.

So how long would you last if your income dropped 12% month over month ???

And since we all know NAR is a lying sack of shit - you can guess that the August numbers (which they already have) are probably down 50%.

And, while we're at it, even BOA has a paper out saying that 40% of buyers who would have qualified for a mortgage a few months ago, do NOT qualify now.

I'd say 40% being optimistic - I'd put the real number at closer to 70%.

The stench from the fan gets worse every single day - and still idiots push the stock market up.



Out at the peak said...

Wouldn't it be (Y * 5) / (X * 0.33) = How many months inventory (if working with month numbers)?

Say in a normal market when you have five months inventory or 100 houses for every 20 buyers. If you apply the formula, you get 500 house for every 6.6 buyers, then it will take 75.8 months to clear out current inventory.

In some isolated zip codes, we are seeing this problem.

Anonymous said...

Those red necks in Tampa, the "conservative family values with the closet full of skeletons Republicans", can always pray for Jesus for more real estate buyers. The invisible man who lives in the sky will help them on their greedy journey...PRAISE THE LORD!

Anonymous said...

Even a second grader would understand that math!

brokersleaveyoubroke said...

So, now you must prove to the bank that you can actually afford to buy a house before they will give you a mortgage and that means now you have only one third of the buyers you had before. The implication here is that up until now two thirds of the buyers were buying houses they couldn't afford. Of course the realtor has no clue that this 2/3rd reduction is a good thing and that selling houses to people who can't afford it is a bad thing.

Anonymous said...

of the 1/3 that remain, how many will not qualify for a traditional mortgage even if prices drop by 50%?
i bet of the 1/3 only about 10% have a 20% down payment, high enough credit score and high enough income to sucessfully enter the housing market.

Anonymous said...

Small town broker says,

Keep up the good work Keith.

1) "Investors" are not buying
2) "2nd home" buyers are not buying
3) Subprime and Alt A, 40% of the buyer pool last couple years, can't buy.

Looking back at the last few months 60% of the loans closed are not available today. It's like a door closing.

Refinances of resetting subprime ARM's not available. They do not qualify for current underwriting criteria. Most are upside down equity wise. Typical subprime ARM reset rate = 11% or 12% with no way out. Will the lenders forbear?

Really surprised at how quickly things are happening.

Consumer spending and consumer confidence is next. Holiday retail sales should be interesting.

If the fed cuts their rate, long term rates will rise on inflation fears. Stagflation?

A perfect storm. Dig in, it's gonna be years before this shakes out.

Anonymous said...

The equation should read

( Y x 500%)/(X x 33%)=DOUBLE HOLY CRAP

Anonymous said...

seattle/swellview is starting to wake up to the fact that they are not special anymore,theyll have one heck of a hangover before its done,no more pink ponys

Anonymous said...

What good is all this information if home owners looking to sell their houses are still asking ridiculous prices? I still see the same old asking prices and the same old houses for sale on the MLS. Saying "price reduced" is a joke. They lower prices by 5K and expect someone to buy their old wooden shack for $270K instead of $275. (back in '98 it woudl have sold for under 100K and they would have been happy to get it) Whoopie! Big deal! There will be no movement until owners LOWER THE PRICE SIGNIFICANTLY.

turdly said...

$270K instead of $275. (back in '98 it woudl have sold for under 100K

Actual household income is down [ever so slightly in 2007} to below incomes of 1998. Many many of here have tagged 1998 as where the prices of homes will settle. It looks like we were right on the money, even though it was just a hunch.
So that house will be 100k sooner or later. if it wasn't for the artificial crap flung at this bubble we would have been back to 1998 two years ago.
Whatever Realtors and brokers did in 1998, they'll be doing it again. they'll go back to being;
cops 66k yearly in some places
car salesman 90k in OC
Mary Kay ladies 8k on average
The bnumber s will go down, the place will stabalize and lalala, those of us who played ant instead of grasshopper will win the day.