Post Weekend Market Observations Here
What do you see in your housing market this weekend? Motivated sellers? Builder incentives? Here is one from the Twin Cities. “Some metro homeowners frustrated with a slowing home sales market are using innovative incentives to attract buyers. The seller of a 1926 Tudor is offering a free car for the buyer, a trend some think will increase.”
“‘I think to get people motivated this may be the next step to getting the energy back in the market,’ says Suzanne Bates, a real estate investor.”
The Burlington Free Press, in Vermont. “For the first time in a decade, the median price of a home in Chittenden County has fallen. Higher interest rates and an exodus of investors have deflated a market where double-digit inflation has been the norm, according to a local real estate analysts.”
From Bend Oregon. “So, is Bend’s bubble heading towards a future burst? ‘It does appear and feel to me that the market is softening as expected and there will be no ‘bubble burst,’ but this will be more clear by mid-summer,’ according to DavidFoster.biz.”
“For anyone wanted to sell this year, they will need to be more careful and competitive in choosing a list price. As buyers have more homes to choose from, become more discriminating and reluctant or simply unable to afford the higher prices; people may not have to pay full price.”
The Washington Post. “The Baltimore Symphony Orchestra’s Decorators’ Show House, a 1929 Mediterranean-style mansion on almost six acres in fashionable Greenspring Valley, failed to sell at auction last week.”
“Though the house is a ‘remarkable property,’ its failure to sell didn’t shock Paul Cooper. ‘We knew we would be challenged to do it’ because about 29 properties in Baltimore County are currently listed at $2 million-plus, but only four such properties have sold in the past four months, Cooper said. ‘That’s one a month; you do the math.’”
From the topics thread. “For those interested in the Northern New Jersey market.”
June Average Sales (2003-2005): 3486
2005 Sales: 3682
2006 Sales: 2911 (Down 20.9% Year Over Year)
“June statistics for Northern VA (and all counties around D.C.) are out. The first column is 2006 and the second is 2005.”
Loudoun County, VA Median Sold Price: $ 485,000 $ 491,000..-1.22 %
Total Units Sold: 515, 994 - 48.19 %
Another had this anecdote. “Anybody besides me doing any home improvement projects right now? I’m finding contractors are actually returning phone calls now; a huge change from only a few months ago.”
Woke up early this morning, turned on the TV. It was on some kind of Real-Estate infomercial channel. They were going on about how real-estate had gone up 20% - 30% in the last year…….. in China and India! I guess they are running out of US case stories…. All this news was interleaved with commercials about mortgages and the lifestyle you could get with equity loans. I should have taped it, it was amazing. Can’t remember the channel, it was three letters, MNN or something (San Diego area).
Union Tribune this morning has Lyon homes paying your interest until 2007. Sounds pretty good, but it actually only amounts to $18k if you read the small print and do the numbers. Must say they are creative, certainly caught my eyes. There’s million ways to skin that cat.
Oh great than you don’t get to take the interest write off . Give me the 18K as a price deduction please , thank you . Also if I was a lender I want 10% to 20% more down payment on that 18k kickback to the buyer .
down here 100,000 off price is not uncommen (now.)
This last week I saw a billboard in Albuquerque on one of the busiest streets in Albuquerque advertising “Zero Down” and a “Seven Day Cruise” if you purchase through a particular realty company.
“it was three letters, MNN or something (San Diego area)”
DNN. I’ve believed in a SD bubble since 2003. I think DNN marks the top.
Nice episode of Property Ladder on TLC this week. Idiot 25yo coffee shop clerk buys his flip project (a 100 year-old bungalow), and has no money to renovate. His repeated attempts to get additional financing are denied. He calls daddy though to get some cash for the project, and cuts every corner imaginable. When it’s finished, the host (Kirsten Kemp) asks him about his list price thinking that it is “aggressive”, and he poo-poos her and says that he deserves a $100K profit because he has worked so hard. Well, after 20 weeks on the market and 5 more mortgage payments, he sells for basically a break-even amount (that was disappointing, was hoping for foreclosure with the $4500 mortgage eating him up). He says he wants to flip again, so I think that his parents will be bankrupt soon.
We saw that flipping thru channels last nite - hilarious. Pompous ass loser almost got what he deserved…almost.
Single family inventory over the past 5 weeks (Sell your McMansion Now?)
Norfolk VA - Inventory up 14% from 5,617 to 6,396 while median price goes down 1%, average down 2%. Fastest inventory growth again in the $1M to $1.25M range, with another large bulge at $750K.
Oklahoma City, OK - Inventory up 7% from 8,017 to 8,554 while median price is down 2% and average price is flat. Fastest inventory growth again in the $1M to $1.25M range, with another large bulge at $650K.
Orlando, FL - Inventory up 9% from 16,321 to 17,860. Median and average asking price is down 1% from 5 weeks ago. Fastest inventory growth is in the price range from $950K to $1.2M, while it seems that homes in the $1.75M to $2M seem to be moving off the market either by sales or withdrawal.
Peoria, IL - Inventory up 10% in the last 5 weeks, median price down 1%, average price down 2% in the same time period. Fastest growing inventory section is priced from $400K to $600K, which has increased 22% in the time period. This for a Midwest town with a 2000 census median income of $36,397.00
Reno, NV - Inventory up 8% from 4,110 to 4,450. Median and average price show a 0% move in the time period. Keep in mind this is summary data over the entire Reno area. Average asking price in Reno stands at $631,307.00 for a single family home, and the median is $419,000.00. Maximum gain of inventory is in the $1.5M to $1.75M for this market, which is kind of a surprise to me.
Richmond, VA - Inventory up 8% from 6,231 to 6,725 in the past 5 weeks. Median and average price show very small declines to $299,000.00 median and $352,183.00 average. Even in this modest area the fastest growing inventory segment seems to be around the $1M mark, with inventory in this price range increasing nearly 20% in the last 5 weeks.
Salt Lake City, UT - Inventory up 12% in last 5 weeks. Median price is up 3% in that same time period to $399,900.00 while the average price came down 1% to $791,753.00. That seems pretty damn pricey for an area that had a median household income of $45,140 at the time of the 2000 census. Of course back then the median prices was just $145,195.70. That represents an increase of $254,704.30 or 175%. I don’t think that the median family wage has increased by that same percent. Oh yes, their fastest growing inventory segment is the now familiar $1M to $1.25M range.
The big boys or the smart money are trying to lock in their gains. Or more likely, trying to prevent a sizable capital loss. The total number of millionaires in this country is going to fall substantially.
When are the lenders and appraisers stop these phoney “incentives” — these bonus items are non-recoverable and it proves they are lending more than the value of the properties.
You got it right, this is so stupid. Gotta say, when I worked for Helmsley (no nastines please) in the mid ninties we were in the same market, but no one tried to put lipsick on the pig.
Yeah because she likes to put her own makeup on! HAW HAW HAW
everyone was covering ass as they didn’t want “actually” lower prices. Gosh that could be actionable, Ouch
SUZANNE (or anyone!) Can you post a link of what you think is the best site to vew foreclosures (specifically New ENgland, CT).
Much obliged…..
Was in that biz for a bit. Please don’t waste your money. Go to hud.com ect. There is no free lunch, you are in competion with the “big boys” so don’t let them fool you, get in hard , know what your doing and go for it, BUT—-do it right, bring a bolt cutter to any prop your serious about and just run it , do not play, break in, bring in inspectors (I always bring dogs too) Be prepared to kill the bolt, run the prop in the dark and make an offer (by the way as vile as this may seem we did it and made $300,000. enough said
Hud.gov—–anything else is just bullshit!!!!!!!!!!!!!!!!!! Did this for years, please listen——————-
To avoid possible federal jail time from breaking and entering on federal property. Dataquick offers a fee service where you can get in most counties real time foreclosure information. Although Hud.gov is a good source most of the time it’s dated and typically hud stuff is crap, and if your an individual investor just trying to line your pockets. Most of the stuff available to win a bid on you probably don’t want and if it’s any good a proffessional shark will run it up t where it’s not worth it.
Sales down almost 50% in Loudoun County? Pretty remarkable when you realize that Loudon County is where a lot of the new homes are and were they’ve been offering incredible incentives.
loudoun and fairfax,va have the best job growth in the country- and still re is crashing
I drove around out in loudoun near Leesburg this afternoon. The Potomac Station neighborhood is insane. I have never seen so many houses for sale in one neighborhood. Literally a dozen on every block. Every street corner had open house signs pointing every which way. I didn’t go in any of the open houses but driving by I saw minimal if any traffic at all and we had beautiful weather. My wife loves the houses out there but she was instantly convinced of the real estate bubble by driving through the Potomac Station neighborhood.
A lot of people talk about a widening bid ask spread before price corrections. We are seeing nearly identical houses in Potomac Station listed one for 560k another for 750k. You can really tell who has to sell and who is just looking to make a bonanza. It won’t be long and realtors will refuse to list anything unrealistically priced because they don’t want to waste their time/money.
I wish these builders would knock off the game playing with their incentives and just lower the friggin’ price.
The builders are trying to get around lowering the comps . If you give 50K in incentives you are reducing the price of the home by 50K You can’t make the loan based on the 50K higher purchase price . You can’t have it both ways , and I contend that the lender/builders would be in violation of regulations if they allow this sort of incentive kickback without reducing the purchase price of the home accordingly .I want to know if they are even disclosing the kickbacks to the lenders.
A seller could give 100k in kickbacks on a 500k purchase ,but if they expected the lender to give a 90% loan on the 500K purchase price you would be going way over 100% financing .I don’t know how the builders are getting around this . I hear that some builders own their own mortgage companies .
And as far as buyers goes , do you want to pay the higher property taxes on a home that should have the price reduced ?
All the big national builders own their own mortgage companies - & insurance companies. They whack the sheeple who have crappy credit & no $ down with high rates & lotsa fees, after inserting the shaft with the high price. This is how they have rung the bell on profits over last 5 years.
I’ve noticed before that new subdivisions often have high foreclosure rates. I will not trust comps identified as “builder sale” in my tax records.
“Loudoun County, VA Median Sold Price: $ 485,000 $ 491,000..-1.22 %
Total Units Sold: 515, 994 - 48.19 %”
Is that YOY nominal decline, or MOM? So you can say ~ -5% real decline?
If YOY, the DC bubble guy must be having a field day with this.
DCBubble - Where are you? Please explain this YOY decline?? Maybe he is with LV_Landlord?
“The seller of a 1926 Tudor is offering a free car for the buyer, a trend some think will increase.”
Only until people realise not only are they really paying for the car but they also get to pay taxes on it when they go to register it.
Not just car taxes - would you prefer paying 400k on a home, getting a car free, and paying property tax on 400k, or paying 375k for the home, buy your own car, and pay property tax on 375? The seller is offering people the chance to increase their property taxes by the value of the car.
I get why the builders want to play these games, but why wouldn’t a seller just lower their price?
The builders don’t want to piss off the prior home buyers or have to lower the price on people they are already under contract with . My beef is how are they getting these incentives passed by the lenders as not being a reduction in price and a adjustment to the appraisal or the loan amount allowed ? The incentives are getting bigger and bigger all the time .
Apparently, some builders are caving.
On OCrenter’s site, there’s a link to a blog written by a California realtor:
http://www.bubbleinfo.com/
His candor is surprising. Go to his entry dated June 28, 2006. In one subdivision, he analyzed a particular 4800+ sq ft model, finding 19 total sales since inception. There were two sales in May 2006, one for $900,000, and another for $1,060,000. After some digging, he found that of the 19 sales, 11 carried loans of $900,000 or more, putting a full 58% of the owners of this model underwater.
Oh, man, that’s gotta hurt!
Winjr
Thanks for the plug.
The builder you refer to, Lennar, is selling virtually every house at 10% or more BELOW list price. If you are the salesperson, how do you greet the potental buyers?
“Hi, make any offer and we’ll take it!”
I don’t care how they spin it, if I got the impression that the builder was dumping on price, I’d get spooked and NOT buy.
People have no business buying a million dollar home without at least 20% down, if not %50. What the hell are the lenders thinking? These stupid people need to be in 400-500k homes max. How in the world is someone approved for a 900k mortgage??
Like I said, I get why the builders do it, but I doubt the guy selling the 1928 Tudor is under contract with a lot of other people. If you’re selling your own home, what benefit is it to sell a 375k house and 25k car for 400k, instead of just a 375k house?
He most likely already OWNS the car - therefore he would be walking away with an extra 25K in cash….
Good point, the guys here have it all wrong. Why pay for today what you can pay for for 30 ys in prop taxes when you might want, a new car, life, boob job, is there ever a time where enough is enough???
Not only that, you financed the “free” car with a 30 year note. (Or 80/20 interest-only or something.) Sheeesh. Just buy the car from a dealer, haggle him down to near factory price, take a single digit interest car loan for a few years. Duh.
Maybe they should at least make the car a real period Phaeton:
http://www.schaferinternational.com/carsale/
Note the .jpg’s
I just received a flier in the mail - one of the Orlando condo conversions just reverted back to apartments and are offering move-in incentives.
I took a look at the ‘condos’ four months ago when they were trying to sell them at full speed. They were priced higher then similar single family homes in the area. No wonder no one bought.
Other condo conversions are struggling to sell their units as well according to a real estate agent I talk to occasionally.
Tom — very soon, “…one of the Orlando condo conversions just reverted back to apartments…”
will be, “yet another of the Orlando condo conversions just reverted back to apartments.”
Renters soon should find themselves in sweeter living quarters, courtesy of the floppers. What goes around comes around.
Here’s how the rope is tightning in Sarasota
Here’s how the rope is tightening in Sarasota! See link below
http://www.pelicanpress.org/main.asp?SectionID=130&SubSectionID=225&ArticleID=2383
link?
Taxes and insurance going up in FL and sales going down. This is going to get, well, you know the rest.
Well it should, why do you think anyone came here!
Nothing better in South FLA than “higher prices indefinately”, huh?
Jungle Jim —
“Another city landlord for the past 25 years related: “I lost $3,000 yesterday,” because he has three vacancies among the single family homes he rents. Asking his name not be used, the landlord said he’s trying to sell the properties “and the market is dead.”
He didn’t lose it yesterday — that is theatrics. He may have lost it over a month. But he sure didn’t drop his rents, did he? Why not? He is selling too late, so he’ll either renege and rent for less when he can’t fetch the buying price he feels entitled to, or cut his losses and run all the way back to New Yawk.
“I can’t wait to sell out and get the hell out of Sarasota. My taxes are averaging about 25 percent increases every year for the past four years. And hey, that doesn’t even include the big insurance increases. How can you run a business like that? I have no money to even maintain the properties now.”
Yo, Mr. landlord! Get your butt out in the median and campaign to throw the local bums out! Nothing, nothing at all prevented your elected politicians from lowering the tax millage to offset the increase in revenues from phony appreciation.
“Jude Levy is a renter in the city and an activist who helped put together the city’s Tenant Landlord Coalition. ‘Well, rents are certainly going up – if you can find a place to rent,’ Levy said last weekend. ‘Sure, if you can spend $1,000 a month, your choice is unending, but the focus needs to be on the workers and fixed income people with low incomes.’”
Here’s the difficult truth, Mr. Levy: If you work at Barnacle Bill’s or at Blake Hospital or at Anna Maria’s Oyster Bar, you don’t really *need” to live west of U.S. 41. And west of 41 is where the rentals seem to be that are talked about in this quote; work your weay east toward the Interstate and you’ff ind what you need. You are looking for rents under $1,000 a month and within walking distance of the ocean. That might happen later, but if it isn’t happening now, not many people will cry for you. By your own admission, Mr. Levy, there are beaucoup rentals available at and above $1,000. Guess you haven’t traveled much, to see how the truly deprived live.
thanks jj
My market observation:
….Bellevue, WA radio commercial “Everyone knows it’s a buyers market. Call me to get a good deal on your home.”
What a swift change. Three houses for sale in my area have been for sale for 3 months now (asking price wayyyyy high of course, but it’s a start). I’m starting to get itchy :), but yes folks, I know I’ll have to wait until at least 2008. However, watching the downhill ride (gain momentum) is a lot more fun than the uphill ride :).
It will soon be a no-buyers market.
It is 12 noon AZ (and CA) time, check out the awful people touting the wonderful Phoenix real estate investment market on this radio station right now. It runs for 2 hours. I promise that you will feel ill.
http://www.kknt960.com/
I’ve listened to these clowns before. It’s a paid infomercial. I’m sure a lot of Sun Lakes listeners aren’t aware of that all important fact…
What’s the temperature in Phoenix today. Is there any open houses, and what sort of desperate buyer is out looking when he could be at the lake or the mountgains? On 2nd thought, what moron realtor is having an open house today? The market is crashing right now, Phoenix is ground zero, and the figures will be released in Mid August showing that the week after July 4 started the actual fall in prices.
I object. Florida is ground zero.
These incentives are crap and we all know that. For gullible buyers that don’t know how to think for themselves it’s like dangling a carrot in front of a very hungry rabbit. If they’d only THINK things through they could figure out what we have all been saying about this kind of approach at selling.
Back in 1991, I had a choice between buying a $107k or a $89k identical condo. The higher priced one “showed like a model”; the other one was owned by an 70+ year old woman with failing eyesight, condo filled to the brim with clutter and grease an inch thick in the kitchen. What did we do? We looked BEYOND the clutter and grease and figured out that once the furniture and clutter were cleared away and the place was cleaned, they would be the same….why pay the higher price? We bought the lower priced unit. It took less than $1,000 and less than 2 weeks to hire painters to paint the entire condo, carpet cleaners to clean the carpet throughout, and an appliance guy came out and assessed the appliances and made repairs, had all of the draperies cleaned and rehung, and the kitchen thoroughly cleaned (I did the draperies and kitchen cleaning myself).
No one can tell me that wasn’t the better deal to be had. Some people are just too lazy to see that they can really save themselves a lot of money by, what?….thinking it through.
Personally, I think that staging is unnecessary. Of course, if you can’t see the floorplan then, yes, in those cases you may have to move some of it out or around differently so people can see what’s there. I look at model homes and visualize MY furniture in these places. I use my imagination and look passed “their” stuff. So they are offering the washer and dryer and other goodies? No thanks. With a deal like that I know that that puts a higher price tag on the washer and dryer…I’m paying for the damn things every month, and much more than they are worth.
Anyway…my 2 cents and experience for what it’s worth.
Have a wonderful day everyone. It’s gonna be 100 degrees here in Dublin, CA (ugh!). Going to a “tea” with my daughters and ex- SIL. Should be fun and relaxing.
BayQT~
BayQT:
I’m interested in Dublin because I used to rent there in late 90’s.
I was on Bedford Way just off Village Parkway. It was one of thoses Village ranch boxes. It was cold in the winter because of little wall insulation and a small, wall, in the hall gas heater.
BTW:
My friends form San Ramon used to call it Scrublin.
Is that right? I’ve only been here for 3 years and I have no complaints….never heard it called that though. Did they say why? And what do they call it now?
BayQT~
Dublin is very different even since ‘97; there weren’t those million dollar homes over the top of the hill towards Castro Valley, and my sister’s kids used to climb up there and actually have some open land to play on.
The amazing thing I thought at the time was how much higher rent a Sam Ramon address place was; soon as you crossed Alcosta the rents way up. Sounds like Dublin is less the middle-class bedroom communtiy it once was.
Reporting from Boise:
The housing tracker http://www.benengebreth.org/housingtracker/location/Idaho/Boise/ shows that inventory continues to skyrocket while the median sales price has leveled out.
In the Boise metro area, over 1200 homes are listed on the MLS as under construction; Over 900 homes are listed as “new and never occupied.”
My neighboorhood is about 1 year old and spans about three blocks. There are 7 homes on the market- none have sold in past few weeks; two “new and never occupied homes” are on the rental market. The home across from me was reduced from 199k to 194k a few weeks ago.
I have been seeing something new in the Boise area: “price reduced” signs! I’ve also seen more and more open house signs as RE agents actually have to market their listings. The days of flying to Cali and closing millions in RE deals are over. I’ve also noticed more and more FSBO signs along the road and “flat rate” realty ads are more common.
Its pretty obvious the RE market is cooling around Boise and will get worse.
Boy , the boom didn’t last that long in Boise . Boise got hot I think in the latter part of 2005 and now the froth and thrill is gone already .
The market started picking up in 2004 but whipped into a frenzy in 2005 as the word spread to investors from Cali- but now most of the investors have left. Stuff is still selling, but not like before. I’m curious what will happen over the next year. The news reported that construction jobs increased 18% over the last year. As the construction/RE/mortgage industry slows, people will lose jobs and the snowball effect will begin.
According to a Realtor I spoke with anything over 180K is now “buyers market” (more than 6 months of inventory) in Boise. Here in Eagle stuff sits & sits. There is about 9 months of inventory. Prices are starting to come down, but nowhere near reality. A house I went through sold for 450K in early 2005 and now it’s listed at 675K — that is with a price drop already. The high-end stuff still has a way to come down. I pulled the records for the house at the assessor (online) and the owner is delinquent on taxes already.
The best part was someone was in the house looking and told the RE agent they could sell their place for 500K, because that’s what it was appraised for. The RE agent, basically said bull sh*t in a very polite way. The smart RE agents are already pricing below comps and the market. They know what to do, get out while the getting is good. It’s going to get interesting across the board here soon
“A house I went through sold for 450K in early 2005 and now it’s listed at 675K — that is with a price drop already”
Another listing reeking of flipper…
Job report notes, frankly I’m surprised and skeptical that real estate and constuction related employment is even flat?:
http://www.epi.org/content.cfm/webfeatures_econindicators_jobspict_20060707
“An important hint from today’s report, for example, shows that employment in residential construction fell 6,800 over the past two months, the sector’s first back-to-back monthly losses since the spring of 2001. Thus far this year, residential construction employment is up 7,000, compared to an increase of 20,000 over the same six-month period last year. And while employment in real estate was up 5,000 last month, job growth among credit intermediaries and insurance carriers—so-called “downstream industries” from the housing sector—has been notably flat over the past few months. In other words, there are many connections between the housing sector and other sectors in the job market, and the cooling of that sector has far-reaching implications.”
Well I haven’t experienced this in a while. A subcontractor called me asking about a job he had bid on and offered to “work with me” on the price. Of course his original bid was 3 x what it should’ve been but it’s a start down that long winding road to the little place I call Reality.
just a note, but it seems that the #s may not support the facts, many employable people are in the LTD pool. and YOY stats may support this as as much as 10% of the workforce is just plain pissed at whats going on.
Something seems to be going on, I wonder if people are now pulling their homes off the market.
Bakersfield went from 6,141 Single Family Homes on the market June 23rd to 5,570 on the market today. Has there been a big surge in selling or are people who were “just fishing” now getting out of the market?
June and July are big selling months and Bakersfield is in the lower price range . We don’t know how many price reductions took place to reduce the listing supply . Also I believe people/flippers are taking their houses off the market and perhaps waiting for the big market surge the NAR/realtors are predicting for the future .
This has always been and will never be as bad as everyone thinks, what will kill this ship of dreams will be oil and stupidity
“what will kill this ship of dreams will be oil and stupidity”
Well, I certainly agree with that. The first part of your post, I’m not sure what to think of. This blog focuses on real estate, but peak oil is going to rear its ugly head. It will make the 2 hour commutes impossible, and drive house prices down in small towns as people move back to the cities. Southern California real estate will bust, but the parts near the Los Angeles light rail stations are and where the good jobs are will suffer mildly, and recover in the long term.
Peak Oil, like Global Warming, is just a myth to scare you into more government.
Sorry, but ‘they aren’t making any more oil’ is a true statement.
No, it’s not true at all. People have known for years how to make synthetic oils (the stuff you use to lubricate your engine is synthetic). It’s just cost prohibitive for most applications.
Likewise we know of huge oil reserves in places like the tar sands of Canada. It may surprise you to learn that Alberta has more crude oil reserves than Saudi Arabia; it’s just cost prohibitive (at the moment!) to drill for this oil in large quantities.
We will never run out of oil. We may run out of cheap oil but that’s a totally different question. Right now we have expensive oil for one reason, and one reason alone: geopolitical instability in the Middle East. If Iran goes nuts and the price of oil shoots to $150 per barrel the trader who paid $75 per barrel has made a gigantic profit.
And furthermore, as long as living beings inhabit the earth, fossil fuels will be created.
Don’t be silly. There’s more than one reason. A falling dollar, higer global demand, and supply issues, to name a few.
I think a lot of fishers are pulling listings, but they really don’t make that much difference. Their asking price was outrageous and they weren’t going to be selling anyway. Comps are what matters. The people that need to sell will set the price.
I’m with Joe.
The people that need to buy will set the price.
I’m seeing a fair amount of temporary fishing in my area, too. And at all price levels, too.
The term “fishing” is irritating when used in this context. Those “fishermen” should put their baitless, worthless poles back in their garage of greed.
They can re-list next year when comps are lower.
The Bend article is typical early phase denial. I sold last summer, took the money and ran. The house soon relisted at a 35% increase, and everyone told me I sold too soon. Now after three price reductions it is still sitting there, and the flipper has it priced to where he is just losing the interest. So far. The place has 1200 houses for sale and a population of 75,000.
For years the Bend formula was sell something expensive in California, buy a house in Bend and a few rentals. It worked when the rentals were $80,000 and brought in 600 a month. It even worked when the rentals we $180,000 and appreciating like mad. Now they are $325,000, still renting cheap and declining in value. Look for more of them on the market soon.
May 29th 2006, Bend had 1,656 SFH on the market at an aggregate asking price of $71,509,002.00
July 8th 2006, there were 2,269 SFH on the market at an aggregate asking price of 99,057,798.00
At the end of May there were 20 houses with an asking price at or over $3M, and July 8th there were only 17.
Closer to the market median, there were 169 houses with an asking price at $300K (+/- 25K) in late May, and today there 260.
The property count from the $1M - $2M range has gone up nearly 80%, so it seems folks who bought high are trying to get out now. I am curious as this is a trend that is emerging over the markets that Ivy is tracking. Did some memo go out to everyone that it was time to “dump it now” ?
Sigalarm,
Where do you get your Bend figures? I am tracking Bend also, via the Central Oregon Assn of Realtors — getting similar trends but lower inventory numbers. Also, more than 85% of the listings are over $300K. I would say the median listing is $400K+. One thing that is clear driving around town is that about 1/5th of the town is for sale and that many are FSBO or via Assist2Sell outfits.
Thanks.
To be honest, the pedigree on my data might be off. I am strip-mining the MLS for a number of specific zip codes listed as being part of the Bend MSA (Metro-area). The data mining agents (I have refered to them here as “Ivy”, as I named the project after “Ivy Mike”) then heavily tag the information before dumping it into XML in a database. A second set of agents come along and perform correlation and combination on the data given a set of rules I specify. I have been posting some minor excerpts here for our enlightenment. I am still not sure what I am going to do with this data. I primarily wrote Ivy Mike to see if the framework I wrote for work could be re-trained to mine an MLS rather than it’s original target data sources.
Mentally dividing your aggregate asking prices by the number of listings I get a mean of $45K, give or take.
Seems a tad low. Do you by any chance have a lot of null prices being treated as zero :)?
You are right! I need to check it out and see what it is doing in there. Thanks for posting that.
I hate crap articles like this one in the MSM.
This is from TheStreet.com..Jim Cramer’s place (big surprise).
http://biz.yahoo.com/weekend/prop_1.html
“Not Too Late for Real Estate”
Despite an undeniable slowdown, the real estate market is far from dead.
…”The days of whopping 30% or 50% price gains are over,” says Tom Stevens, president of the National Association of Realtors. But Stevens says 6% to 8% price appreciation will happen in several markets over the next year, and “that’s still a phenomenal return
…And even though appreciation is slowing in a number of former hot spots, PMI found that half of these large metropolitan regions will maintain double-digit appreciation rates over the next two years.
———————–
SHAMELESS!
I’m sure many of these locations will indeed ‘maintain double-digit appreciation over the next two years’.
Shame about the minus sign, though :D.
I’ve been informally tracking SFH inventory for 5 places in So Cal and Central Coast Cal:
Altadena - Los Angeles Area
3/4/2006 - 97
7/8/2006 - 140
+44%
Arroyo Grande - Central Coast
3/4/2006 - 173
7/8/2006 - 230
+32%
Pismo Beach - Central Coast
3/4/2006 - 290
7/8/2006 - 401
+38%
Apple Valley - High Desert
3/4/2006 - 796
7/8/2006 - 1293
+62%
Joshua Tree - High Desert
3/4/2006 - 183
7/8/2006 - 236
+28%
(This is a really informal survey conducted by using realtor.com’s listings of SFHs for sale in a given area)
Boise, IA market is really getting into swing now-
Single Family Homes, May 30, 2006
Market Count: 4,119
Median Price: $269,950.00
Average Price: $347,209.00
Single Family Homes, July 8, 2006
Single Family Homes, 4,888
Market Count: 4,888
Median Price: $269,900.00
Average Price: $347,461.00
Yes, number of homes on the market up 20% in the last month and a bit, prices are dead flat.
Here is the “trend” in Seattle area (King Co)
Week Inventory %Increase since May 7
7-May 7302
15-May 7486 2.52%
21-May 7665 4.97%
11-Jun 8099 10.91%
18-Jun 8154 11.67%
24-Jun 8352 14.38%
1-Jul 8417 15.27%
8-Jul 8758 19.94%
Everything in “good areas” (i.e. water view/walking distance to water) is selling like hotcakes (CA equity locusts mostly) while the rest of Seattle inventory sits and sits and reduces and sits…..once the CA spigot is turned off Seattle starts to sink.
I resent the California equity locusts buying up all the prime real estate and driving the prices through the roof as they marvel “Wow this is so much cheaper than where we came from”! I hope these next few winters are so rainy and miserable for them that they can be found on suicide watch at the local mental hospital. No, actually, I don’t wish that on them. I just hope the market tanks, they hate the weather, they leave, never to be heard from again, and our prices go back to what they used to be, affordable for us hard working people who need homes to live in at reasonable prices.
I like the winters here believe it or not, so bring them on.
The problem is that they are locusts - mindless, eating locusts with no memory. Next summer there will be a new crop.
Albuquerque, NM looks to be shaping up nicely as I hear the sound of something starting to hit a fan out in the desert.
Single Family Homes, May 30, 2006
Market Count: 2,683
Median Price: $275,000.00
Average Price: $365,154.00
Single Family Homes, July 8, 2006
Market Count: 3,269
Median Price: $269,000.00
Average Price: $353,399.00
Inventory is up 18%, median price down 2%, average price down 3%. That is in just over a month. The data shows that the segment of the market from $500K to 750K is growing the fastest, with the $1M to $1.35M second in terms of unsold inventory stacking up waiting for a buyer.
Denver CO seems to be stuck in the mud right now. Not much inventory being added, no price appreciation on average or mean
Single Family Homes, May 30, 2006
Market Count: 20,818
Median Price: $269,500.00
Average Price: $392,972.00
Single Family Homes, July 8, 2006
Market Count: 23,046
Median Price: $269,000.00
Average Price: $388,420.00
So a 9% gain in inventory with a statistically insignificant move in median price, average price is down about 1%. Where the fun really starts is looking where the inventory is being added. The biggest gainer are homes in the $1.8M to $2.3M range, up around 60% in inventory in the past 5 weeks or so. It seems that the McMansion liquidation drive is going on? Second are houses around $100K in price, up about 43% in the same period.
Thankfully for me I think some of this trend information correlates with an article already posted on Ben’s outstanding blog.
More support for the sell your McMansion now meme -
Data just compiled for (of all places) Des Moines IA show that the fastest growing inventory are homes in the $750K to $1M. IOWA! 10% of the inventory added in the last 5 weeks has been in this price range. Given the median income in this town ($38,408.00 at the time of the 2000 census) there may be a problem.
Comments folks - is this flippers trying to hit the eject button, FB’s getting their ARMs reset and trying to bail? Thoughts? Anyone from the Midwest who can give us a “weather report”?
News from Phoenix
Played golf today with the girls. The girl that has the house for sale in Cave Creek still has not sold after dopping the price 55K. Now I find out that she was having problems getting a loan on her new Toll Bros condo because 70% of the units have not sold. I want to know what she is going to do when they start to drop the price on units around hers.
Thanks, AZgolfer, I had wondered what was happening with her. (I guess it’s a form of voyeurism). Keep us updated.
i went to an oprn hose in sebastopol ca today,at 501 s main st,web address http://501 main.info.it is a 10 unit development,mixed live/work and town house,of above average quality.it is one block from the hospital,a liquor store minimart is across the street and the bordering streets of main and petaluma blvd are one way divisions of hwy 116,prices run $559k to $720k.no other traffic except an appraiser.the broker indicated there was “some flexibility”on the prices.they have been on the market since april 1st,none have sold,the flyer states “all offers will be reviewed 9 days after the initial release”.i rent a custom 2400 sq ft home on 5 acres for 1800/mo,5 minutes further away from major amenities.the $720k unit will rent for 1250 in this area…after reviewing the flyer it is clear the developer expected multiple offers at or above asking price for all these units on or before completion.
open hose, I like that phrase.
The seller of a 1926 Tudor is offering a free car . . .
Ummmmm, I thought a 1926 Tudor was a car.
Hi All,
Just got back from a week in Ocean City, MD - and the amount of inventory for sale, as well as the builder incentives being offered blew me away. One building (sorry no pics) had a huge sign advertising $50K incentives - while in the same building, hanging from the balcony rails, were no less than six realtor signs trying to unload flips. Another ad in local rag: “$150K-$300K” off made me read it twice. Entire buildings covered in for multi-color realtor signs - looked like Christmas tress with oranaments dangling from them.
I casually follow inventory there. Last year there were approx 700 2BR+ condos for sale according to realtor.com. As of this morning… 1,362. Nearly a 100% increase. And the building underway is just going to flood the market with more inventory.
Sadly, this is the last year for going there with kids. The place has changed over the past few years, and not for the better. Hadn’t been there since 2003 and was taken aback by how much the visiting crowds changed, and the inability to even order ice cream in English (large Russian immigrant population). Can’t imagine this will bode well for $600K condos - but hey, as I’m fond of saying “Good luck with that.” Next year, back to the Carolinas…
Delaware, including Bethany Beach, is still very nice.
arson rates for september should be high
Had the weirdest experience reading the Syracuse Post Standard this morning. In their Housing market & mortgages section of the RE section, 23 towns in Onandaga county report their homes sold #s for the week, and ytd. I was stunned at the number of towns that were up over last year! 11! The down numbers were not down by that much either. Our county is lumped altogether but we’re up +- 7%. (That just doesn’t jibe with my top selling realtor friend reporting her June #s were down 50%)
Also of note from the same paper: Investors Drive Prices
Out-of-town investors continue to help set the market for rental properties in the Syracuse area. Real estate brokers, long accustomed to selling apartment complexes for about $25k per unit, no longer raise their eye brows when prices exceed $30k”
In the little corner of the world I’ve been tracking since last June (some SW Phila suburbs) inventory has been running as follows:
6/3/05 784
6/24/05 812 (highest in 2005)
1/6/06 677 (lowest since 6/05)
6/3/06 1004
6/24/06 1034
7/9/06 1020
I know lots of folks are interested in what is happening in the Las Vegas market. I was in Vegas this past week, and it seems that several of the condo projects have not really moved forward much since I was last there (a month ago).
Single Family Homes, May 30, 2006
Market Count: 17,728
Median Price: $369,000.00
Average Price: $487,164.00
Single Family Homes, July 8, 2006
Market Count: 17,665
Median Price: $367,794.00
Average Price: $490,012.00
Number of single family homes on the market is down in Las Vegas. Not sure if this is because of increased selling or people taking them off the market because they are not moving. Prices are absolutely flat. Maybe we can see some interesting information on Condos?
Condos, May 30, 2006
Market Count: 4,070
Median Price: $225,000.00
Average Price: $305,107.00
Condos, July 8, 2006
Market Count: 4,388
Median Price: $306,085.00
Average Price: $490,012.00
So condos show an 8% increase in inventory in the past 5 weeks, while prices are pretty much dead flat here. In single family homes the biggest market price ranges are at the bottom end of the market below $150K, where there is a significant amount of property being sold. Meanwhile more homes are being added in the $1M to $1.25M range. Also of note there are 120 properties in the MLS that list for $3 Million or more, and that inventory number is not moving.
I have a bunch more data now from about 20+ markets, and many are showing a similar pattern. The lower high end of the market looks like it is suffering. These are homes priced below where the mega rich can just “buy it” with cash, and above where the upper middle class can buy without exotic finance. That’s not to say that none of them are selling, but in general the fastest growing inventory segment in bubble markets being tracked shows that this range of homes is the one that is growing fastest.
Anyone have any correlating data or stories to share?
I know I have been sort of spamming this blog with numbers, I am not sure if folks find them intersting, useful or just noise. If you want I can post more of them.
Here on the northeast side of the Twin Cities (Minnesota), the glut of new developments haven’t seen much sales activity. The poor citizens of the town of Hugo - about 10 miles north of St. Paul - tried to impose a moratorium on development a few years ago, complaining the housing boom was diminishing their quality of life and steeply raising their city and property taxes to pay for the newcomers. The developers threatened to take the town to court, so after a year the construction frenzy began anew.
Now the aftermath: mile after mile of new developments lining Highway 61 north and extending along Frenchman Road into the formerly sleepy town of Centerville. With mile after mile of frantic builders’ promotional signs touting the new homes. But the signs along the highway are getting hard to see, nearly buried in the underbrush that has grown up around them. Some of the signs have new signs attached: ‘FREE CAR!’ (with purchase)
It really is something to see. The signs are clustered in large bunches every half-mile or so, and at practically every major traffic light. It is certainly not a sight that inspires confidence in the local housing market.
And here’s an excerpt from a local article about our slowing market:
Housing boom now a dull roar
Residential permits drop amid rising mortgage rates, fuel prices
By Gita Sitaramiah
With “For sale” signs crowding the landscape, area home builders continue to tap the brakes on new construction.
Permits for residential construction in the Twin Cities dropped a hefty 15 percent through the first six months of the year compared with the same period in 2005.
The slowdown in home sales and residential construction stems from rising mortgage interest rates and fuel prices.
“We have an oversupply of land and lots and an oversupply of homes both new and existing and something’s got to give,” said John Lockner, a Remax Results Realtor in Woodbury.
http://www.twincities.com/mld/pioneerpress/business/14991148.htm
I was at a party in Rancho Cucamonga (San Bernardino County, CA) yesterday. Pulte had just finished a bunch of houses on the other side of the fence and two out of the three that I could see had not been sold yet.
And a 5-year-old at the party asked me, “Is your house as big as this one?” (the house we were at was 3,000+ sf) and I answered, “no, we live in a little 2-bedroom apartment.” The 5-year-old looked at me with a mix of shock and pity :lol until I told her we lived walking distance to the beach and then she said how cool that was :lol
Isn’t it sad how the children are raised soooo materialistically
Stats now from Miami, FL. Many folks who read here think that Miami is one of the big bubble areas, and they would not be wrong. At this point there are over 90,000 listings in the MLS for the Miami area. That number seems to be growing at about 1% a week.
Single Family Homes, May 30, 2006
Market Count: 35,248
Median Price: $465,777.00
Average Price: $813,437.00
Single Family Homes, July 8, 2006
Market Count: 37,216
Median Price: $459,900.00
Average Price: $788,542.00
For the speculators in Miami, it’s starting to get grim. Over the past 5 weeks we have a 1% decline in the median price and a 3% decline in the average asking price. At the same time we have 6% inventory growth. At the same time the condo market shows a 4% increase in inventory with an even steeper, 3% decline in the median asking price.
For SFH, the fastest inventory growth is once again in the $1M to $1.25M market segment. Also of amazement to me is that there are 405 condos with an asking price of $3M or more in the MLS right now.
Apologies in advance if you guys get tired of my one-off comments. Seattle, WA: the Eastside appears to be slowing down - finally, and I hope it lasts.
Signs? All of a sudden, 20 new homes on the market in the past 20 days.
People who can’t sell rightaway, are showing cash flow desperation by putting the house up for rent. Example: MLS #: 26090832. No bites for 25 days. Price reduced from 500k to 480k, and now you can rent it for $1895. http://expo.live.com/ViewListing.aspx?lId=92642
This is just one of many…I hope it sticks this time folks…I’ll keep you posted.
bella condos in atlantic city has an ad in this Sunday’s paper offering “LIVE FREE FOR ONE YEAR! Buy now and we’ll pay your mortgage for one year!”
http://bellacondos.com/
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526 PACIFIC AVENUE, ATLANTIC CITY, NJ 08401 • 609.344.8700 • bellacondos.com
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in Queens Village in 1985? Or a loft in Olde City in 1995? Today your modest
investments could be worth millions. That’s the kind of opportunity available
today in the North Beach area of AC. With new developments like luxury retail,
restaurants and high-end hotels and casinos, growth in Atlantic City is exploding.
In fact, while the residential housing market is beginning to show signs of slowing,
Atlantic City is one of the few places that is still growing. Call today and don’t let
another golden investment opportunity pass you by. Offer ends in September.
http://bellacondos.com/images/live_free.pdf
News on year-over-year prices for the central coast Cali - San Luis Obispo county medians:
March 2005 - $493,400
April 2005 - $536,340
May 2005 - $534,440
June 2005 - $570,870
July 2005 - $559,900
August 2005 - $566,510
September 2005 - $602,160
October 2005 - $603,120
November 2005 - $605,160
December 2005 - $534,930
January 2006 - $592,590
February 2006 - $604,170
March 2006 - $586,270
April 2006 - $599,360
May 2006 - $556,670
Even if prices stabilize and go flat (which, according to realtors I’ve talked to, they are not), the June 2006 median year-over-year price change be negative for San Luis Obispo County.
There was a RE person on a local real estate show today saying that she expected prices to go up 10%-15% hear this year.
To hit her mark, we have some catching up to do…
In San Diego (rancho bernardo specifically), I know a complex that is being converted to condos. They have sold a grand total of 4 in the past year. They have 160 left. Lots of luck with that.
Just came back from a ride through our old neighborhood in North Park. I was surprised to see that in the last couple months, four houses on our block have sold. I know one of them sold for $660K, 150K more than the sellers paid for it in late 2003.
I thought sales were slowing down, but evidently sales are still brisk here in central San Diego.
I was out looking for a home today (to live) as mine is under contract. I stopped off on a street not far from my house and saw a home for sale. I pulled over to get a flyer in the rack, and a realtor sprung on me like a lion would a gazelle. She was telling me how slow it was here in Atlanta. Really?
Luckily, she was cute. I did end up seeing the house. It was a dive. Not a total waste though, I am taking Tiffany out this week.
Inventory in Portland, Maine (04103 zip) is still down since January, but recently there has been an uptick:
1/16/06 232
1/30/06 218
2/7/06 220
2/16/06 228
2/25/06 226
3/8/06 211
3/22/06 193
3/29/06 189
4/7/06 181
4/14/06 187
4/23/06 202
5/18/06 198
5/26/06 194
6/7/06 199
6/24/06 213
7/9/06 223
Anthem (Henderson, NV)
2 months ago 3 beautiful (empty) SFHs with view of Vegas. Drove by today. All 3 still for sale. RE signs leaning now and no brochures available.
LOL