The Housing Bubble

The Contra Costa Times reports from California. “East Bay home sales continued their downward slide, DataQuick reported Wednesday. Contra Costa sales fell from 28 percent, 1,735 to 1,246, while the price moved from $575,000 last year to $600,000 this year. Both Alameda and Solano counties reported a drop in sales of 13 percent and 37 percent respectively, and a 2.1 and 7 percent decrease in median prices, respectively.”

“A total of 7,447 new and resale houses and condos were sold in the Bay Area last month, down 18.4 percent, or from 9,129 in April of last year, DataQuick reported. Sales decreased on a year-over-year basis for the last 27 months.”

“Last month’s sales count was the lowest since 5,636 homes were sold in April 1995.

The Fresno Bee. “California home sales have been down on an annual basis during the past 19 months. Historically, sales begin ramping up in the spring. The decline this year may be due in part to the surge of homebuying that occurred during the housing boom.”

“Home sales in the San Francisco Bay area slowed last month, with Santa Clara and Sonoma counties posting median price declines. Sales have fallen in the region on an annual basis for the past 27 months.”

“The biggest price decline occurred in Sonoma County, where the median price fell 8.5 percent to $519,000.”

The Press Democrat. “Sonoma County’s housing downturn hit a new low in April, when prices fell for the 10th consecutive month and sales cooled at a time when the real estate market normally begins to heat up. Sales have fallen 19 consecutive months in year-over-year comparisons as the housing market continues to contract from its peak two years ago.”

“‘The numbers would say that this is not a stellar month. Sales and prices were off and inventory increased at a seasonally expected rate, increasing seller competition and buyer opportunities,’ said Rick Laws, Santa Rosa manager for Coldwell Banker, which prepares The Press Democrat home sales report.” ”

The Sacramento Bee. “Sacramento-area escrow closings dipped in April to their lowest levels since 1995 and fell below March sales counts for the second straight year, DataQuick reported.”

“It means a much-hoped-for spring rebound in home sales has again failed to materialize this year. Last year, sales of new and existing homes peaked in March before leveling off for the remainder of the year.”

“The slower sales numbers arrived alongside reports that another 1,500 existing homes went up for sale in El Dorado, Placer, Sacramento and Yolo counties in April. Sacramento-based TrendGraphix reported 14,026 homes for sale in the four counties as May began, about 1,500 shy of the region’s all-time inventory high last July.”

The Daily Bulletin. “Southern California home sales fell to a 12-year low in April, further evidence that the beleaguered housing market is in transition.”

“The biggest declines came in San Bernardino and Riverside counties, with sales in San Bernardino County off 46.7 percent from a year earlier and Riverside County down 45.1 percent, according to DataQuick.”

“Bill Velto, manager of Tarbell Realtors in Upland, said that despite a large amount of inventory on the market, more than half of it is overpriced.”

“‘We’re looking at about 60 percent of homes for sale that are priced higher than buyers are currently willing to pay,’ he said. ‘I believe we have transitioned and are now two or three months into a buyers’ market.’”

“Velto says the county could be the most recession-proof market in the Southland. ‘There are 3.5 million people supposed to be moving into Southern California the next 10 years,’ he said. ‘At this point, at least, San Bernardino County housing is recession-proof.’”

The North County Times. “Home prices in Riverside County fell in April for the first time in a decade as buyers continued to gain market power from large numbers of unsold houses, a research firm reported.”

“The falling prices result largely from an unbalanced housing market, local and regional experts said. ‘All of a sudden, you’ve got 10 properties and only one buyer roaming around out there,’ said Earl Bonawitz, who manages the Temecula office of a real estate agency.”

“Bonawitz said many of his agents have been advising clients not to sell their houses only to lock in equity gains or move into a more expensive house locally. Unless a job change requires the move, it’s probably not worth the time and expense, he said.”

“‘It’s an issue of timing and pricing,’ he said. ‘You can price a house to sell today, or you can price a house to sell two years from today.’”

The Union Tribune. “In East County, El Cajon agent Doug Jones has found that many buyers are delaying purchases in expectation of dropping prices. ‘If they are making offers, they are offers way below what the normal asking price is,’ he said. ‘Everybody wants to get a deal.’”

“On Saturday, more than 1,200 people turned out for an auction of nearly 100 foreclosed homes at the San Diego Convention Center. Among the successful buyers was renter SueAnn Miller of Rancho Bernardo.”

“Initially, Miller was happy with the condo she purchased during a fevered bidding session. Yesterday, she was having second thoughts. Eager to stop renting, Miller said she might have paid too much.”

“‘I was looking for a deal,’ she said. ‘I probably rushed into it too quick.’”

The Voice of San Diego. “Fewer homes were sold in San Diego County last month than in any April in a decade, DataQuick reported.”

“‘The market is retreating again, unfortunately,’ said local real estate analyst Peter Dennehy. ‘The people who can afford to be in the market are the ones who are savvy and they are waiting for a good deal.’”

“‘There are more and more people now who are at the lower end of the market who aren’t able to qualify for loans because of the tightening, which isn’t a bad thing, but it doesn’t help (the general market),’ Dennehy said.”

“Andrew LePage, from DataQuick, said he doesn’t think the region is poised to recover yet. ‘We’re at the end of the cycle, but not the last day of it,’ he said.”

The Orange County Register. “Banks sent out 855 notices of default to Orange County homeowners in April, said DataQuick on Tuesday. Last month’s defaults were up 129 percent from April 2006. Default numbers have been generally rising since July 2005.”

“Foreclosures didn’t take an April breather. Last month’s total of 234 foreclosures was the highest since August 1998 and was the fifth consecutive monthly increase. It was up 15 percent from March and 964 percent from a year ago.”

“Orange County’s housing market just had its slowest April in 12 years, DataQuick reported.”

“This also marks the second spring with a glut of homes being offered for sale in the county and the 19th month in a row that the monthly sales pace fell below the previous year’s level.”

“Tarbell Realtors’ Brea office closed Tuesday, and its staff was moved to a Tarbell office in Yorba Linda, said Tarbell agent Wynn Kamen.”

“Observers say other chains also are looking for ways to cut overhead. ‘There are offices closing and offices consolidating,’ said Rich Cosner, president of a chain of Prudential California Realty offices in north Orange County and the Inland Empire.”

“DataQuick reported that 2,682 escrows closed in April, down 24.7 percent from April 2006, a month that already saw a sales drop of 28 percent from the near-record highs of 2005.”

“Resale condo prices also were up from a year ago, but the median price of new homes, both single-family and condos, fell 10.1 percent from a year ago, pulling down the overall median.”

“Countywide, the glut of home listings grew to 15,935 Monday, closing in on the record of 16,006 homes for sale set in August, according to Steven Thomas.”

“Broker Molly Doughty said…buyers ‘don’t feel the urgency to make a commitment. They’re waiting for the price to come down.’”

“Still, prices overall are holding, she said. While price reductions of $100,000 are occurring with some of her clients, most are willing to wait. ‘Most sellers just aren’t that desperate,’ Doughty said.”

Chicago Business reports from Illinois. “Buyers signed contracts for 1,207 downtown condos and townhomes in the quarter, a 46% plunge from 2,243 in the year-earlier period, according to a report by a Chicago-based real estate consulting firm. It was the seventh straight quarter of declining sales and the biggest quarterly percentage drop so far.”

“‘Buyers have numerous options. They have little sense of urgency,’ the report says. ‘And these buyers are now fewer in number with the retreat of many investors and speculators who had been flooding the market a few years ago.’”

“Some developers have responded to the weaker market by scaling back their plans. Yet other developers are moving full speed ahead with new projects, indicating that the supply of unsold condos is more likely to rise than fall in the coming months.”

“Downtown developers had 7,416 unsold condos at the end of the first quarter, up only slightly from 7,405 at the end of 2006. Sales fell 29% last year, to 5,783 units, and could drop to 3,500 to 4,000 units in 2007, Appraisal Research estimates.”

The Chicago Tribune. “With first-quarter downtown condominium sales cut nearly in half from the year-ago period, auctions are a quick way to sell, eliminating months of carrying costs for owners willing to let go of property for well below asking prices.”

“The number of properties sold on the block has doubled from last year for Inland Real Estate Auctions Inc. ‘Now there’s an oversupply of pretty much everything, including luxury housing,’ said Frank Diliberto, Inland Real Estate Auctions president. ‘For higher-priced housing, there may be less inventory, but there are fewer buyers.’”

“Until 18 months ago, most of the company’s Midwest activity involved commercial property. Now, its auctions involve a substantial supply of housing. The last time the company had so much residential activity was in the real estate downturn of the early 1990s, he said.”

“Last month Inland auctioned 17 newly renovated condos in the Rogers Park neighborhood. They sold for about 15 percent below asking price on average.”

The Courier News. “Home prices in Illinois held steady in the first quarter of 2007, but sales plummeted more than 14 percent from the year-ago figures, according to the Illinois Association of Realtors.”

“Association figures for Kane County show a slightly greater dip in single-family home sales: down 16.7 percent compared to first-quarter 2006 sales.” “The median home sale price in Kane County was $243,000, down about 3 percent over the same period last year.”

“Mary Roberts, broker in Elgin, conceded the market is slow and noted she and her associates now consider it ‘normal’ if sales take a bit longer to consummate. ‘We know for several years’ the delay in selling a home ‘was out of sight, and now we’re back to the normal six-month time to sell a home,’ Roberts said.”

“‘There are still buyers out there, but your home has to be one of the best if not the best in order to get chosen from all those in the marketplace,’ she said.”

“Roberts said some buyers may seem a bit too cautious, but most simply want to see ‘everything that’s out there.’ ‘There’s a lot more for buyers to look at, which makes it very confusing,’ Roberts said.”

The Post Cresent from Wisconsin. “Local real estate professional Dawn Christensen wasn’t surprised to see that sales of existing homes in Wisconsin were down for the first quarter of 2007.”

“‘The early numbers never look good, but as we get into April and May, things do tend to pick up,’ Christensen said.”

“The Wisconsin Realtors Association, citing National Association of Realtors figures, Tuesday reported statewide home sales fell 6.5 percent for the first quarter of 2007.”

“David Clark, an economist with C3 Statistical Solutions Inc. in Milwaukee, which compiles sales data for the state realtor’s group, said the numbers do reflect a ’softening in the market.’”

“‘Buyers are seeing homes on the market longer so they know they can bid down,’ Clark said.”

“Several counties in northeast Wisconsin experienced reductions in sales volume including Brown County down 2.4 percent; Outagamie County down 5.2 percent; Waupaca County dropped 9.4 percent, and Winnebago slid 13.6 percent when compared with last year.”

“Sales drops were most noticeable in Kewaunee County, down 21.4 percent, and Door County, down 27.9 percent. Sales volume fell 5.9 percent in south central Wisconsin and dropped 7.8 percent in the southeastern part of the state. Sales in the northern Wisconsin were down 10.6 percent.”

The Downtown Journal from Minnesota. “Home foreclosures are relatively infrequent Downtown, with the exception of a 90-year-old brick building that has tallied 15 foreclosures since August 2006.”

“The cause of the foreclosure spike at 607 Washington is something of a mystery, but real estate documents indicate that three condo owners are behind nine of the foreclosures, with more than one foreclosure in some condos due to multiple creditors.”

“Several units in the building remained on the market for two years and sold in the summer of 2005 at hundreds of thousands of dollars more than the original list price, a trend that seemed odd to some Downtown real estate agents.”

“The building’s foreclosure plight is not representative of the rest of Downtown, although Downtown foreclosures doubled in the first quarter of this year compared to the first quarter of last year.”

“The city’s 7th Ward, which encompasses Downtown, saw 49 foreclosures in all of 2006 and 26 foreclosures in the first quarter of 2007.”

“Unit 407, advertised to be a 1,560-square-foot space with hardwood floors and a Jacuzzi, was listed as a 1,610-square-foot unit in March 2003 for $399,900 with no takers. Then in July 2005, the unit was relisted for $559,900 for 37 days, and listed again at $600,000 for four days.”

“The unit closed on Sept. 30, 2005 at a price of $600,000 with a seller’s contribution of $98,098. That unit was foreclosed on twice in 2006, according to the Hennepin County Sheriff’s office.”

“The story varies from unit to unit, but tax records indicate that all of the foreclosed units have sold for $140,100–$449,100 more than the 2003 list price, an average unit price increase of about 77 percent over three years.”

“Resident Amit Vas said he moved into the building in December and said he doesn’t know much about what is happening there. ‘There aren’t very many occupied [units],’ he said. ‘I hardly see anybody.’”

“‘We have no idea what’s going on; we don’t care,’ said one employee.”

“There are five units in the building currently listed for sale by a variety of different agents, and three of those units were foreclosures. Angela Larson, (an) agent selling a unit at 607 Washington, said she is listing it at $200,000 less than it was sold for a year ago.”

“‘As soon as a couple of them start going down it makes it hard to get financing in the building, and it makes people not want to buy and it makes it worse for everybody,’ Larson said.”

Some housing bubble news from Wall Street and Washington. The Associated Press, “Construction of new homes posted a small gain in April but applications for building permits plunged by the largest amount in 17 years, a dramatic sign that the nation’s housing industry is still in a steep slump. Even with the improvement, housing construction is 25.9 percent lower than a year ago.”

“And in a worrisome sign for the future, builders cut their requests for new construction permits by 8.9 percent in April. That was the sharpest drop since a 24 percent fall in February 1990, another period when housing was going through a significant downturn.”

From CNN Money. “Home builder confidence fell for the third straight month in May and executives in the battered sector now believe they’ll have to wait until next year for even a sluggish recovery to begin, according to an industry survey released Tuesday.”

“The survey by the National Association of Home Builders saw the confidence index sink to 30 in May from 33 in April, matching the September reading that had been a 15-year low at that time.”

“The subindex measuring builders’ view of current market conditions fell to the lowest level since February 1991, while their view of the market six months from now and their perception of buyer demand both dropped to match the 15-year lows hit in late 2006.”

“‘The crisis in the subprime sector has infected other parts of the mortgage market as well as consumer psychology, and as a result the housing outlook has deteriorated,’ David Seiders, the builders’ chief economist, said in a statement.”

“‘We’re now projecting that home sales and housing production will not begin improving until late this year, and we’re expecting the early stages of the subsequent recovery to be quite sluggish,’ he added.”

From Bloomberg. “‘It’s going to take more time’ than previously expected to shake off the housing recession, Seiders said last month. Subprime woes are costing builders ‘a lot of sales and also increasing cancellations.’”

“‘The decline in homebuilder sentiment is largely due to fears of subprime mortgage fallout,’ said Michelle Meyer, an economist at Lehman Brothers. ‘We could see a decline in demand going forward.’”

“The NAHB/Wells Fargo index of sentiment fell to 30 this month from 33 in April, the Washington-based association said today. The reading matched the figure for last September, which was the lowest since February 1991. Readings below 50 means most respondents view conditions as poor.”

“The measure of single-family home sales declined to 31, the lowest since February 1991, from 33. The index of traffic of prospective buyers fell to 23 from 27. A gauge of sales expectations for the next six months declined to 41 from 44.”

“Builders are scaling back new projects to work off new-home inventories that in March equaled 7.8 months’ worth of sales, the second highest since March 1991.”

The Telegraph. “Spain’s foreign reserves have plummeted to wafer-thin levels, leaving the country exposed to a possible banking crisis if the property market swings from boom to bust, despite membership of the eurozone.”

“Total reserves have now fallen by two thirds from €41.5bn in early 2002. Greece and Portugal have seen a similar drop.”

“‘The current account is completely out of control,’ said Alberto Mattelan, an economist at Inverseguros in Madrid.”

“‘We have the worst deficit in our history and worse than any other country in the western world. It has not yet become a ’street concern,’ but I can assure you that it is of great concern to us economists. This will turn bad over the next 18 months,’ he said.”

“‘Where this gets serious is if there is a property collapse in Spain and the banks get into trouble,’ said Prof Tim Congdon, an expert on monetary policy.”

“The first signs of a housing slump are emerging as the ECB raises interest rates, already up seven times to 3.75pc since December 2005. The shares of Valencia builder Astroc have fallen 77pc since February, setting off a sharp slide across the sector, with knock-on effects on banks with mortgage exposure.”

“The party is ending after a near tripling of house prices since 1995. In a report, Jamie Dannhauser from Lombard Street Research, said Madrid is now making matters worse with a new law to hit property speculators.”

“‘This screams of closing the stable door after the horse has bolted. House price growth has clearly peaked and is decelerating quickly,’ he said.”

From John Berry. “As 2006 began, the core consumer price index was rising at a 2.1 percent annual rate, and then it took off, peaking at 2.9 percent in September. By last month, the rate was back to 2.3 percent, the Labor Department reported yesterday.”

“Last year’s acceleration was due to a series of large monthly increases in rents and a separate part of the CPI called owner’s equivalent rent. Fed Chairman Ben S. Bernanke and many analysts said the sudden jump in both measures of rental costs occurred when would-be home buyers decided to rent instead of buy as housing prices began to fall last year.”

“The resulting increase in demand for rental units allowed landlords to raise their prices sharply. Now the shoe may be on the other foot.”

“Owner’s equivalent rent, which carries the greatest weight of any item in the core CPI, rose at only about a 3 percent annual rate in the six months ended in April. That’s down from a 4.6 percent rate in the six months ended last September.”

“Brandeis University economist Stephen G. Cecchetti said yesterday that last year he ‘was warning that rises in OER would eventually push core inflation over 3 percent. Well, that hasn’t happened.’”

“At that time, Cecchetti said, he thought that years of rapid increases in home prices had so outstripped the change in rents that once house prices stopped rising, it would take years of rent increases to close the gap.”

“‘What I failed to see was that the combination of a high inventory of unsold new homes, combined with increased mortgage defaults could flood the rental market,’ he said. That glut ‘is holding OER down now and is likely to continue to do so in the foreseeable future. The result will be falling CPI inflation,’ Cecchetti predicted.”

“Ohio Attorney General Marc Dann, likening the subprime lending industry to armed robbers, said he wants to sue Wall Street firms because their bond sales enabled consumers to get mortgages they couldn’t afford.”

“‘If somebody was buying guns and giving them to people to go and take people’s houses at gunpoint in Ohio, we’d be prosecuting them and throwing them in jail,’ Dann said.”

“Securities firms encouraged ‘irrational loans’ to be made, Dann said, by providing a liquid market in which mortgages were bundled by the thousands and sold as securities.”

“‘I want to see the e-mails, I want to see the documents,’ he said. ‘I’m guessing somebody at some or all of these places was predicting the bottom was going to fall out.’”

“The state may seek damages from mortgage companies and investment banks even for ‘purely criminal’ situations in which borrowers committed frauds against lenders, Dann said. He cited the harm such schemes did to communities that could have been prevented if lenders had been more cautious.”

“‘My clients are certainly taking Marc Dann’s comments extraordinarily seriously,’ said Richard Gottlieb, a partner in Chicago at Dykema Gossett PLLC, which represents firms involved in home lending and securitization, including Irvine, California- based New Century.”

“Savings and commercial banks with federal charters are protected against state regulators, and charges against other lenders probably will fail, too, Gottlieb said. Still, attorneys general often ‘gain most of their leverage through the desire to avoid bad press,’ he said.”

“Lehman Brothers Holdings Inc., Countrywide Financial Corp., Morgan Stanley, and Merrill Lynch & Co. were the top sponsors of subprime-mortgage securitizations last year, according to newsletter Inside B&C Lending.”

“‘The question is who benefited from this that still has money,’ Dann said, adding he’s also weighing suits against ‘four or five’ more subprime lenders.”

From Reuters. “Ohio’s attorney general said on Tuesday he won’t hesitate to file civil racketeering charges against Wall Street investment banks if his investigation finds they had a hand in fraudulent subprime lending.”

“‘We’re going to try to find a way to hold them accountable,’ Dann said.”

“He said one legal strategy he might pursue is using the U.S. Racketeer Influenced and Corrupt Organizations (RICO) Act, which was formulated to fight organized crime. The act allows for civil claims to be filed, too, to allege fraud. ‘We’ll take the case where the evidence leads us,’ Dann said.”

The Tampa Bay Business Journal reports from Florida. “In first quarter 2007, Florida’s housing sector continued to mirror the national pattern, with higher inventory levels of homes for sale, median prices edging down and soft sales reflecting a buyer’s market in many areas. In Tampa Bay, sales dropped 37 percent from the first quarter last year, while the average price of homes fell 2 percent, to $212,200 from $217,300.”

“Homeowners have given up all of the gains achieved in 2006 and are now falling back to the fall of 2005 for comparable prices.”

The St Petersburg Times. “More downbeat news from the Tampa Bay area housing market. The messenger is the Florida Association of Realtors. Condos go for $171,900 this year vs. $177,800 last year. A glut on the market, 40, 000 homes and counting, could suppress prices further.”

“Tampa Bay area home sales are sluggish, but one type of property is turning over faster than it has in years: realty offices.” “With half as many homes selling this year as during the boom in 2005, Realtors are closing, selling or consolidating their physical property.”

“Thanks in part to high property taxes on second and vacation homes, beachfront property has taken a pounding, and so have Realtors on the coast. One of the most successful, Sand Key Realty Sales and Rental, closed one of its three offices, the one in Indian Rocks Beach.”

“‘To maximize profits, you have to cut some of your losses,’ owner Jim Robbins said. ‘We’re still doing $6-million to $7-million in sales a month. It’s just not the $15-million we used to do.’”

“The culprit is home sales that have plunged from their record-setting peaks of 2005. In Pinellas, Hillsborough and Pasco counties, Realtors sold 2, 488 houses and condominiums last month. That compares with 4,998 sales in April 2005 and 3,783 last April.”

The Palm Beach Post. “The number of homeowners falling behind on their mortgages nearly quadrupled in St. Lucie County last month compared with a year ago, RealtyTrac said Tuesday. Florida had the second-highest number of filings in the nation with a total of 14,318 households entering some stage of foreclosure last month.”

“‘I know that banks are pleading to take properties off their hands even before they get to their REO (real-estate-owned) department,’ said Delray Beach luxury homebuilder Frank McKinney. ‘Twenty years ago, we sat on the courthouse steps and bid on properties and bought them.’”

“That’s no longer happening, McKinney said, ‘which shows me this huge flood of foreclosures will continue to hit South Florida well into next year.’”

“Depreciating home prices make it hard for owners facing foreclosure to sell their houses for what they owe, while tighter lending standards make it hard for potential buyers to qualify for a loan.”

“In Palm Beach County, the median price of an existing home fell 4 percent in the first quarter compared with the first quarter of 2006, the Florida Association of Realtors said Tuesday. Sales dropped 20 percent, a troubling double-digit decline in what many had hoped would be a successful spring selling season.”

“‘Walk into any…Best Buy or Circuit City and ask them about sales of big-screen TVs and computers,’ said Mike Morgan, broker in Stuart. ‘Boats, cars, clothing, jewelry and more,’ he said, ticking off big-ticket items that debt-plagued homeowners can no longer afford.”

“‘The housing ATM is out of money,’ he said.”

The Herald Tribune. “(Sarasota County) will lay off 26 workers in its building department today because of a declining real estate market and expectations that state lawmakers will soon cut local tax revenues.”

“The layoffs are ‘a precursor of the type of things to come,’ according to County Administrator Jim Ley, who last month announced a ’soft’ hiring freeze and temporarily halted plans to expand the county’s fire department and public transportation service.”

“County officials say the building department layoffs are tied more to the real estate slowdown than to expected cuts in local property taxes. The county left open the likelihood of more layoffs.”

“Manatee County’s building department is financed by builder fees, which have declined significantly, said County Administrator Ed Hunzeker. The same goes for Charlotte County. The number of building permits issued by Sarasota County was down 65 percent during the first three months of the year.”

“A trio of reports on Tuesday showed that the future of Southwest Florida’s real estate market remains murky even among signs that it is outperforming most of the Sunshine State.”

“During the first three months of 2007, the area posted a 6 percent rise in sales compared with the year-ago period, the state’s only market in positive territory.”

“Its median sales price, however, dropped 12 percent to $290,500. That was the state’s biggest percentage decline aside from Charlotte County-North Port, which saw a 13 percent drop to $197,300. Sales there declined 16 percent.”

“Sarasota County’s foreclosure rate is double what it was a year ago and was 54 percent higher in April. Manatee County had 222 new foreclosures, up 34.5 percent from March.”

The Bradenton Herald. “The Bradenton-Sarasota housing market was the only one in Florida to experience an increase in sales in the first quarter of the year, compared to the same quarter last year.”

“In contrast, sales in neighboring markets like Fort Myers (were) down 35 percent; and Naples was down 30 percent. Statewide, sales were down 26 percent.”

“‘It’s all relative because our sales were so dismal, the only direction they could go was up,’ said Dan Forbes, broker in Bradenton.”

“Re/Max Gulfstream’s Ken Miller was a little leery about calling Tuesday’s figures the first step toward full recovery. ‘No one can speak from experience about where we are now, but I don’t think you’re going to see any big change until mid-2008,’ Miller said.”

“He agreed the increase in sales was a good thing but says coming off an unprecedented boom makes it even more difficult than usual to predict the path the market will take.”

“Those looking to buy a home under $200,000 have a chance now that was unheard of just a year ago, said May Aston, president of the Manatee Association of Realtors. ‘There are quite a few decent homes under $200,000. Last year, if someone were to ask me for a home under $200,000, I couldn’t have found one,’ Aston said.”

“Those who are buying are looking for deals, experts said. ‘For the true, seasoned investor, it doesn’t matter if it’s a buyer or seller’s market, they are looking,’ Forbes said.”

“And what are they looking for? ‘Steep discounts,’ Forbes said.”

“Miller agreed. He finds that buyers and sellers are at a standoff, with buyers expecting sellers to cut prices tremendously and sellers expecting to get unrealistic amounts of money in the current market situation.”

“During the height of the real estate boom, there was only a 1.7-month supply of homes on the market, but as speculators and other sellers scurried to get out of their homes, that number skyrocketed to more than a 10-month supply.”

“‘If the home was purchased before 2004, they are a little more realistic when it comes to listing price,’ Miller said.”

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