Seeing The Effect Of Unabated Speculation
It’s Friday desk clearing time for this blogger. “Houses sold in one day, above asking price, with multiple offers. It’s the reality of the Austin area’s hot housing market. Realtors have a unique way to get you the house of your dreams. These pocket listings, as they’re called, are nothing new. In Austin however, they’re becoming more prevalent as realtors use them as a tool. It’s the result of a housing market realtor Matthew Layman describes as ‘crazy, bananas.’ ‘Your buyer was frustrated because you’re going against that multiple offer situation and a lot of times paying way too much,’ Layman says.”
“In La Cañada Flintridge, the number of homes for sale eked up by one to 28 last month. The number of homes sold showed a healthy gain from seven in January 2013 to 16 last month. The median price for a home shot up from $1.19 million to $1.48 million in a year-to-year comparison. Paul Habibi, real estate professor with the UCLA Anderson School of Management, said sales of high-end homes priced over $5 million are ‘on fire.’ While there may not be many of them on the market, the ones that are for sale are fetching ‘egregiously high’ prices, he said.”
“The foreclosure rate in Maryland has steadily risen in recent months. A consortium of community and civil rights groups are pressuring Maryland legislators to commit to a six month moratorium on foreclosures in the state. Del. Aisha Braveboy joined state Sen. C. Anthony Muse in introducing legislation in the General Assembly that would put more restrictions on banks during the foreclosure process and on how banks maintain foreclosed properties. ‘The [legislation] will hold the banks accountable and prevent the artificial depreciations of home values in our state,’ she said.”
“The number of New York and New Jersey homeowners losing their houses reached a three-year high in 2013. Banks in these states have been slowly working through a backlog of delinquent loans that enabled borrowers to skip mortgage payments for years. Now these properties are poised to empty onto a market where affluent Manhattan suburbs neighbor blighted towns that are struggling most with surging defaults. Jon Pardi, a 62-year-old resident of Edison, said he could no longer pay his loan because his commission-based income as a mortgage broker dropped to $20,000 a year from a peak of more than $100,000. Having little confidence in New Jersey’s housing market rebounding, and the career prospects for loan officers, Pardi is training to become a holistic nutritionist.”
“‘My odds are down but the chances of saving my home aren’t zero,’ Pardi said. ‘If I start making money again, everything changes. But if jobs don’t come back for me, and for my country, then it’s going to keep moving in a down direction.’”
“‘Inventory is down, there’s no doubt about it,’ said Jan McInturf, owner and broker at McInturf Realty in New Philadelphia. McInturf said there were a high number of homes foreclosed on over the last few years, and he anticipates more to be added. ‘Homes were foreclosed on in massive amounts and we’re still slowly recovering from that,’ McInturf said. ‘And, from what I understand, there is still a surplus of homes that are going to be foreclosed on yet this year and brought back on the market. The government intervened and stopped all that from happening so our market wouldn’t be so saturated that it would really hurt us.’”
“The party might be over for Vancouver’s high-end luxury housing market, according to Immigration lawyer Richard Kurland who’s studying the impact of Canada’s investor program – and more importantly, what will happen now that it’s been cancelled. Kurland foresees a wave of listings for high-end properties seeking buyers before the market drops. ‘I’ve been waiting for this to happen,’ Mr. Kurland says. ‘I expect to see ‘for sale’ signs on expensive properties sprouting like mushrooms, once people figure out what it means to cut off 1,000 buyers at the high end.’”
“The property sector is divided in its opinion on the direction of China’s housing market, with a pessimistic sentiment growing among buyers and worrying some developers, the Shanghai-based China Business News reports. ‘There is a real worry about becoming a buyer at peak prices,’ said a woman surnamed Li, who had bought a house in Guangzhou at the end of last year. ‘I already have trouble sleeping.’”
“Speculators looking to make quick profits by flipping newly built properties are likely to be disappointed this year, the Malaysian Institute of Estate Agents said. With most of these properties scheduled for completion in 2014 and 2015, the primary market will be flooded and depress prices, said MIEA president Siva Shanker. Shanker said many Malaysians had previously rushed to buy new properties from developers, thanks to incentives such as interest-free loans during the construction period. ‘Now we are going to start seeing the effect of this unabated speculation in the past three to four years,’ he told reporters.”
“More than 11m homes lie empty across Europe – enough to house all of the continent’s homeless twice over – according to figures collated by the Guardian from across the EU. In Spain more than 3.4m homes lie vacant, in excess of 2m homes are empty in each of France and Italy, 1.8m in Germany and more than 700,000 in the UK. There are also a large numbers of vacant homes in Ireland, Greece, Portugal and several other countries. Many of the homes are in vast holiday resorts built in the feverish housing boom in the run up to the 2007-08 financial crisis – and have never been occupied, many of which were bought as investments by people who never intended to live in them.”
“‘It’s incredible. It’s a massive number,’ said David Ireland, chief executive of the Empty Homes charity. ‘Homes are built for people to live in, if they’re not being lived in then something has gone seriously wrong with the housing market.’”
“The housing recovery ought to be gathering steam, since the economy is improving, the unemployment rate is falling and banks are easing up on lending standards. Yet the opposite seems to be happening, with home price gains flattening out and sales of existing homes–the vast majority of all sales–dipping. ‘We’re just losing our general sense of optimism about housing,’ real-estate expert Robert Shiller, a professor at Yale University, said in a recent conference call. ‘It’s not fun anymore.’”
“Home prices fell by about 35% on average from 2006 to 2012, according to the S&P/Case-Shiller index, and they’ve bounced back by about 25% since then. But the pace of growth is likely to slow in 2014. Many analysts expect modest price gains of 5% or so in 2014, but another downside surprise is distinctly possible. ‘There really is a worry we might see falling prices by 2015,’ says Shiller.”
