OMG....your link shows inventory is up almost 50% in the last three months. Interesting trend to say the least....! And this is before the I/O popular style loans start to reset next year and the next (and the next). Gulp! OWP
add to that for sale by owner, and all those properties with realtors too cheap to list MLS. on top of that few high profile highrise buildings are opening up in jan 06 and a lot more to come in the latter part of the yr and 07 i think we'll see blood in the streets in 6 months or so.
The real estate crash continues.... http://www.tracypress.com/2005-11-21-biz-one.php "October was the first month in nearly 10 years that the city issued no building permits for new houses, even though builders hold entitlements that would allow them to take out permits for more than 600 new homes." http://www.nypost.com/news/regionalnews/57980.htm "From Westchester County to Fairfield, Conn., to Bergen, N.J., the tri-state area is seeing prices and numbers of sales stalling or dropping, while inventories of properties are starting to pile up. 'Sales are drying up at the top,' said one northern New Jersey broker. 'And now homes on the lower end [of the price scale] are sitting for weeks and months." http://www.valleyvoicenewspaper.com/homeinventory2.htm "The inventory of homes for sale on the Visalia/Tulare MLS have grown from 417 at the end of July to 579 at the end of August, 696 at the end of September and 1005 as of November 11 according to the Tulare County Association of Realtors. A doubling of existing homes for sale reflects a slowing market in this area as can be seen across the nation this fall." "It appears inventory is expanding even as sales slow, perhaps because sellers want to get on the sales bandwagon before prices fall. In the month of October 2005 there were 209 sales while in the same month a year ago sales were 301." "Besides existing houses, new home developers may be feeling the slowdown with reports in Visalia that several large home builders are now 'cooperating' just in the past few weeks with realtors by offering a 2.5% on every sale to realtors. One new homebuilder had reportedly lowered the price of the new home lots." "One local developer who spoke with us on the basis of anonymity, says builders had routinely raised the price for new lots month after month because they could, and it didnât seem to slow demand. Now itâs a different picture. Visalia has an inventory of approved final and tentative lots thought to be about 7000 that builders can use to 'land bank' notes city planner Fred Brusuelas." "Maaske says a slowdown in the markets in the coastal area is resulting in fewer inquiries here. He says investors market was very big here earlier this year. 'Weâre on a slide now,' says Basil Perch, and 'we donât know how far the slide will take us.'" http://www.boston.com/business/arti...t_creative_in_hunt_for_home_buyers/?page=full "For the past five years, homes in Massachusetts have sold briskly, close to asking price or above it. But with interest rates rising and higher energy costs hitting consumers' pocketbooks, houses now on the market are often unable to attract buyers, or lookers. Open houses attract little, if any, traffic. As the winter approaches and home sales slow for the holidays, brokers desperate to close sales are resorting to measures not seen in these parts in a decade." http://business.bostonherald.com/realestateNews/view.bg?articleid=113327 "Condominium prices on Beacon Hill and in the South and North ends are falling due to a dramatic drop in overall unit sales in those and other neighborhoods. Downtown Boston saw a 21 percent fall in the total condo units sold in the third quarter, to 1,211, compared with the same period a year ago." "On Beacon Hill, the median price fell by 10.4 percent, to $394,500, as total units sold plunged by 9.2 percent in the quarter. In the South End, the median price of condos fell by 14 percent, to $472,500, with unit sales off by 37.8 percent compared to a year ago. 'The prices are coming down,' said Virginia Saillant, a realtor in the South End."
Why bash housing, interest rates are stalled. Not only are prices going up because of high demand and limited supply, they gotta keep pace with inflation, too. TOL might even make a good long here.
Things are slowing down but I just don't see the crash that you describe. With 30 year fixed rates hovering below 6% at the tail end of fed rate hike campaign...... money is still cheap. With that being said things are definetly cooling off. Slow markets do not equate to market crashes in my book and certainly not a "bubble" bursting event. Nasdaq 5000 to 1500, now that is a crash....... CMGI at 200 is a bubble. Median home prices @ 200k nationally... it is not the same.
http://quote.bloomberg.com/apps/news?pid=nifea&&sid=a3LvgTs0Ecks The average 30-year mortgage rate reached 6.37 percent last week, up from the low this year of 5.53 percent in July and the highest since April 2004. The Fed increases mean that payments by consumers who took out adjustable-rate mortgages in the last few years will rise by $80 billion next year and $1 trillion in 2007, according to estimates by Deutsche Bank AG. And the 6.37% is for conforming loans. Since in bubble areas prices are not conforming, you ALWAYS need a jumbo. They are running 6.65% right now and rising. It certainly is easy to identify "crashes" in hindsight well after they happen, as in your five year old examples of CMGI and the $COMPQ. Much harder to spot the trend early on. To me the recent price action in coastal real estate markets is absolutely unsustainable and shows the classic hallmarks of mania behavior. I guess we shall see how ruinous it actually is to the highly leveraged masses.
That is not a crash. Please quit being a doomsayer. Let's be realistic here -- the Bay Area will not have a housing crash... sure, it'll top off and stagnate for a few years, but a crash? C'mon now. And let's go ahead and give the readers of ET the whole story from that clip: But with figures from November and December still to be recorded, thereâs a pretty good chance that 2005 will be a record year for sales of existing homes in Tracy. The Central Valley Association of Realtors reported 1,969 sales of existing homes in 2004, and 1,845 sold this year with two months to go. So far, July and October are the only months during which sales didnât top last yearâs figures. Through October, the average price among the 176 houses sold was $545,563, a slight drop from the $547,080 average among the 196 houses sold in Tracy in September. Average prices also took a slight dip in May, but rebounded through the rest of the year. Slight dips, and a $1500 gap DOES NOT a housing crash make.
6% 30 year and sub 6% 15 year is VERY low historically. oneway, I agree that the market is going to change over the next couple of years, however, I do not see a crash. Money is still very cheap and we might not see rates go much higher any time soon (as interpreted by fed comments yesterday). As for the option arms that so many use to get into expensive homes with lower monthly payments there could be some trouble ahead. With that being said we must remember that even if rates spiked their minimum monthly payment will not increase more than 7.5% annually for 5 years. So payment shock is not on the horizon for most option arm borrowers in the near term especially with the low interest rates that we currently see. They will only see trouble if the Fed starts another campaign of rate hikes. Even then it will take 5 years for them to see payment shock as a 7.5% annual increase in monthly payments is not that much.
hasnt crashed yet, you are right. But i do believe the bay area DEFINATELY will be very hard hit along with the east coast floria, and the other inflated areas. man, you have to understand, only 14% of the population makes enough money to afford a home now! with all the specuators...it is going to be blood. yes, we all know 2005 will continute to be record year, but that is beauce people already have the financing and are paying for the home...next quarter that wont be the case. you'll see. there have been MULTIPLE real estate crashed throught the world and throughout history...and the run-up has been much smaller than this one. Unfortunately, the economic effict will be pretty devistating.