Post Local Market Observations Here!
What do you see in your housing market this weekend? Prices reduced? Builder incentives? “K. Hovanians Christmas In July Sale. Save Up To $100,000! Move in tomorrow, next week, next month or by Christmas. View our complete listings throughout Maryland, Pennsylvania, Delaware, Virginia, West Virginia and Washington D.C.”
From Arizona. “Metropolitan Phoenix’s new-home market continued its slowdown in June. Demand from buyers continued to wane and builders pulled fewer housing permits again last month, down 26 percent from last year’s record pace, according to RL Brown. Some people who signed contracts to buy new houses are canceling deals because they can’t sell their existing houses.”
The Hartford Courant. “June is normally a robust month for home buying in Greater Hartford, but not this year: Sales of single-family homes took a 16.5 percent dive, and the median sales price barely budged, compared with a year ago.”
“‘It’s a significant number, and June is usually a pretty good month,’ said Ronald F. Van Winkle, a West Hartford economist. ‘But there isn’t anything that says to us the market is in a downward spiral, by any means.’”
The Reporter in California. “Inventory levels in Solano County rose 56 percent, year-over-year, according to a second quarter report. Sales for the county experienced a 29 percent decline over the same period last year.”
“‘Sellers have been surprised to see the lack of traffic coming by their homes and we’re starting to see the value in making price reductions in order to stand out on the market,’ said (realtor) Scott Kucirek. ‘Buyers are in no rush and were waiting to get the right deal, however, the properties in great condition or with sellers willing to make concessions spent significantly shorter time on market.’”
I’m seeing ‘priced under appraisal’ so many times in local papers, one has to wonder if appraisals matter in a market like this.
Also, heard from a realtor that a colleague in Santa Barbara confided he has a condo that was listed at $650k. Now is down to $550k and he expects to go to $450k next month or so.
Does the appraiser who performed this most recent appraisal (upon which the seller is below) have any liability? He stated FMV was X, 3 months earlier, and now its X minus 10%?
The appraiser will say he was right and that it was worth $x on the day of the appraisal and that today it is worth $x less $100,000 because the market conditions have changed (eg. interest rates up, more layoffs, etc. causing less demand and therefore lower price today)
interestingly enough, when I went out to buy a home, which I didn’t, I found out that a computer does “automatic assessments” in Minneapolis. And, believe me, the computer assessed a home at $184,000 even with water damaged floors and a long list of things to fix. Heck, because the place was in foreclosure, and abandoned by a rehabber, the entire kitchen was torn still apart! Simply unbelieveable.
Cinderella’s coach is going to turn back into a pumpkin!
A whole blog could be devoted to the schenanigans going on like automated appraisals. If you read the industry write-ups, they say it is better than an on-site, personal appraisal!
Here is the latest New Jersey market report, courtesy of the Otteau Group:
June Otteau Report
JUNE SALES DECLINE AS INVENTORY GROWTH SLOWS
June is an important month for the residential real estate market as it represents the traditional end-point of the Spring selling season and typically sets the high-water mark for home sales in any given year. Thus, the residential market in New Jersey had much at stake as any hopes for a market comeback would fall heavily on the June sales performance.
In June, contract-sales activity ran 9% below May and 24% below June 2005, continuing the pattern set earlier this year and dimming hope for a market comeback any time soon. From an inventory perspective, the number of unsold homes on the market increased by 4% in June adding further to an already saturated market. Year-to-date comparisons indicate a 17% decline in Contract Sales and a 70% increase in Unsold Inventory when compared to last year at this time. Some encouragement can be found in the fact that Unsold Inventory increased by only 4% in both May and June, as compared to a much higher increase in the preceding months of January (+15%), February (+12%), March (+13%), April (+12%), giving some hope that inventory will stop it’s upward spiral. At the same time however, even a modest increase in Unsold Inventory is detrimental to the market given the current high inventory levels.
Looking ahead, the Summer selling season typically brings gentle but steady declines in buying activity followed by more pronounced dips during the Fall and Winter seasons. Add in the effects of rising mortgage rates, record high energy prices, and the erosion of consumer confidence towards the future of the housing market and there’s no reason to expect a rebound any time soon!
From a price perspective, there is mounting evidence that home prices will decline over the short term as motivated sellers make business decisions to accept a lower selling price in exchange for a quicker sale. On the New Construction front, the myriad of sales incentives ranging from discounted pricing on upgrades, mortgage rate buy-downs and other financial incentives are the market equivalent of price reductions which will steer the overall residential market to a lower price point. Given that the New Jersey Housing Market realized an 87% increase in home prices from 2000 – 2005, the adjustments now taking place come as no surprise. Nonetheless, expect a bumpy ride over the next few years as the market struggles to restore an affordability balance in the face of rising mortgage rates and energy prices.
Caveat Emptor!
Grim
The more astute buyers (who won’t be emerging for many more months, until the panic selling is well underway) will ignore the appraised prices, given the artificialities and outright fraud that have rendered those numbers irrelevant to determining true value.
PLEASE LOOK AT THE INSURANCE CRISIS IN SOUTH FLORIDA. IT IS CREATING A MASS EXODUS OUT OF THE AREA.
HOMEOWNERS INSURANCE
Sky-high premiums igniting a revolt by consumers
Homeowners in Florida are banding together in an effort to fight rising windstorm insurance premiums that threaten to drive some from their homes.
BY MONICA HATCHER
mhatcher@MiamiHerald.com
in western sonoma county,a near doubling of inventory since july first,many price reductions,people in the grocery talking about the “dead” real estate market,and all the for sale signs.2 new townhome developments in sebastopol with no sales in 3 months…overpriced crap,but would have sold last spring in days or weeks.
“What do you see in your housing market this weekend?”
Dueling sign twirlers on every street corners.
Many open house signs in evidence at major subdivision outlets.
I saw the first ad in the LA Times for price reductions in the last townhomes in Ladera Ranch 92694. Still majorly overpriced, but a good sign. I think I may go look at the models to see where I’ll be moving in 08…
“Dueling sign twirlers on every street corner.”
Camino del Norte & 15, right? Saw three of them representing three different condo conversions.
That’s my hood, We Rent! Are you a math teacher nearby? Maybe you know my kids
Fix-clean it up - Lower the price. Call Nina for help. Sell your pos.
In my area, which is the northwestern corner of LA and southeastern corner of Ventura County, I am not seeing nearly the panic I would like to, but there are some price reductions of between %5 and %10.
Many houses have been sitting for more than three months. I wonder when the breaking point will be - 6 months, 10 months?
Your Geography is a little funny but assuming you are talking Calabasas/Westlake Village/etc. then it is just a case of time delay. Just like last time it took a little longer to get started and it was sticky on the way down but it lasted longer. Just natural variation not immunity.
Yeah, I am being kind of a dope! I never know how to define what I feel is my home area. I wish there was a name for the area between Newbury Park (W), Moorpark/West Simi (N), Old Town Calabasas (E) and Malibu Cyn.(S). I guess “Thousand Oaks area” is the most centrally located.
I am hoping you are right about it just being sticky as so many ultra-wealthy have moved into the area since the last bust - I worry that we are too insulated by wealth to be effected.
Countrywide is one of the top 4 private employers in the county. 9500 or there abouts. Amgen also in the top 4 is in the process of corporate relocation although they won’t admit it. You are correct however about a lot of idle wealth that doesn’t give a sh!t. That doesn’t matter however since houses are priced at the amrgins. It is the wanna be idle wealth poseurs that will crash and take out the prices. BTW neighbor, I’m far west end of Camarillo.
Here in Westlake Village, I’ve seen several sold signs in the past two weeks in front of houses that have been on the market for at least 4 months. I think they’re not getting close to asking prices, at least 10% less. I agree with Cote about Amgen. They’re not bringing people in to Newbury Park anymore and moving quite a few to Longmont, CO. Countrywide is oddly still hiring, but what were regular positions are now being staffed by contractors, even fairly high level analyst positions. I still expect them to eliminate much to most of their Simi Valley and Moorpark staff by mid 2007.
I should also say that I put out some resumes for consulting work (analyst) last month after staying home with my kids for the past 15 months and got three offers (and a gillion calls) almost immediately. The job market in the Thousand Oaks area seems pretty strong in general.
Robert Cote,
I also heard about Amgen. I heard 3,000 - 4,000 mostly in legal are going to relocate to Colorado. I am not sure if it is true or not but, if it is, that is a lot of people.
The west end of Camarillo is beautiful. I love that it is still rural. It reminds me of what California used to be like when I was a kid.
ABR,
Consulting work is what people hire when they don’t want full time employees so it makes sense that you would have a lot of work. Also, I think good analysts are always in demand.
I also found a job in LA very easily (also after a couple years being a stay-at-home mom
). My suspicion is that there are so many young people moving away (due to housing costs) that employers are losing good staff and very eager to find replacements.
For Amgen, their IS dept is moving to Colorado too. I know because a recruiter interviewed me and I was told I could move to CO and get the same salary once the move took place in the next 12 months.
In Westlake Village, I know this to be the case as the census at Westlake Elementary has dropped 15% from last year and they have cut staff. Two (of 19) of my daughter’s classmates left last year when their parents moved to other states and they were not replaced by other kids last year. A fellow volunteer at the school commented to me the other day about how many young families were moving away.
More Californicators moving out to Colorado? Deep joy….
I’ve been a long time reader, first time blog poster. Ben and fellow bloggers, kudos to your insight on the falling housing market!
I am a proud renter, saver and cautious spender. Like many of you here, I know the market cannot sustain itself any longer. I’ve been observing so many areas and talking to people about the housing market.
Anyhow, Amgen is moving IS, Human Resources, and a few depts in Finance and Strategy to Longmont, CO. It’s getting harder for them to recruit young talented people because of their location and housing prices. Some of the IS department is moving at the end of this year.
A few observations…I have a friend that works for Indymac Bank in Pasadena and she told me she received a memo for their CEO putting a hiring freeze effective immediately. This was about a month ago.
I have a friend who was trying to sale her house in Simi Valley for 675K in Oct 05. After several price reductions, all the way down to $605K and still no bites, she took it off the market to rent it out. I’m not sure what she’s thinking — it will be worse next year if she decides to put it up for sale again.
I hear the Big Sky housing development in Simi Valley requires for new homeowners to do their own landscaping within 6 months of their purchase. From what I hear, many of them can’t afford it on top of their $800K-$1M mortgage. On ziprealty, there are people who have their mcmansions on sale sitting on dirt.
I live in West LA area. On my street, there were two homes up for sale. Both are off the market after months of no bites. One house is now being rented out. I’m not sure what happened to the condo — probably waiting for the “soft landing” to end.
With growing inventory, increase in interest rates, many ARMS expiring I am excited to see what the end of 2007 will look like! I know it’s just the beginning…
Thanks for your input (finally!) Sideline! Your observations are just more anecdotal proof that the crest of this mania is behind us. I’m just hoping that the coming crash/economic crisis is bad enough to make people stop spending $4 on a cup of coffee, but not bad enough to make me have to bury my gold.
Haha, idle wealth in TO. You got that right, you must know my dad. Lynn Ranch, could sell for 100K and come out ahead. prop 13 keeps him from moving.
I’m in East Ventura and am seeing alot of For Sale signs and FSBO with a for rent sign together. Also, Olson has signs all over today with soon to be built homes at the low 400’s.
Alot of Vacant homes For Sale also
Santa Paula?
VENTURA
I see the same thing!
There is a lot of talk about soft landings verses a bubble bust and what factors are driving both or what will cause one or the other to happen. However, the biggest single factor that will prevent a soft landing and thereby ensure a bubble bust is rarely mentioned or discussed.
I am referring to the Smart Money of which I am a proud card carrying member. I recently sold a 5,000 Manor Home back East at the peak of the housing price boom (”buy low sell high” is the motto of the Smart Money)and moved to San Diego. Why would the Smart Money move to the most over priced real estate market in the country you ask.
Quite simply the members of the Smart Money are cash rich buyers of which there are many, especially here in San Diego who are sitting out the real estate market waiting for the coming crash. The Smart Money is predicting a 47% drop in San Diego real estate values over the next two years at which time the Smart Money will be buying ocean view foreclosed homes and condos at bargain basement prices.
In the meantime I will continue to enjoy my $860 per month rented two bedroom, bay view condo as I happily watch interest rates climb on my secured investments while simultaneously watching the ARM and I/O loans of others default.
And the band played on.
my secured investments
Secured with what, btw?
Do you mean securities as opposed to equities?
And how does the smart money hedge against interest rate risk when there is a significant rist of either inflation or deflation? Clue me in.
> I will continue to enjoy my $860 per month rented two bedroom, bay view condo
Isn’t that very low rent for San Diego? How did you get it?
There are 603 “reduced” listings on Criagslist in the Bay Area today:
http://sfbay.craigslist.org/cgi-bin/search?areaID=1&subAreaID=0&query=reduced&catAbbreviation=rfs&minAsk=min&maxAsk=max
In Huntington Beach, we now have 6 homes priced under $600,000.
A small step, but the tip of the iceberg.
(Of course, they are crappy homes, but then so are most of the one million dollar ones.)
Fort myers Florida, for sale, must sell, handyman special, reduced, are on all the streets and a large subdivision had some picketers with signs that said” buyer beware “so on a scale of 1-10 on the oh sh@t scale I would give it a 9. The new save the price scam is to raise the impact fees so the inventory will drop and the voted in realestate clowns can flip there holdings. but with a 19 month inventory and not counting for sale by owners homes it looks like a helmet might be needed for the landing. soft I THINK NOT!
in manhattan, despite our purportedly limited, cacheted island estate, there has been a FLOOD of new construction in the past 5 years. as the inventory at the high end of the market ($900K+ for 1 bedrooom apts and up) grows, these prices are notching down about 15%. what was $900K a week ago now often seems to be $800K. this is putting tremendous pressure on the pre-war inventory under $900K, all the prewar and 60s construction not on par with the relatively fewer truly outstanding old buildings.
median price shows what you PAID — but not what you GOT. people homeshop with a fixed amt. to spend in mind. as the market softens, they just end up getting a lot more for their money. but i can’t see how median price has more than a shadow of relation to the strength of the housing market. direction of inventory — and actual offers — says it all.
Irvine inventory 1200+ and climbing. 6 mos. ago it was around 600.
Surprised to see that a condo down the street sold so quickly (less than a week). Even though it was competitively priced I expected it to sit longer.
This just happened with a condo in my building (Santa Clara County, CA). However, the small townhouse next door is on its fourth price reduction. It seems like only the nicest places are selling now.
Inventory in SC County is up over 2,000 units (SFH/condos combined) over this time last year. Most people I’ve talked to seem to think the market is cooling, but will get hot again because “the economy is so good right now in the Bay Area.” Mmm…hmm…
I’ve seen 3 condo’s in my San Jose complex list and then sell within two weeks. These are the smaller cheaper units which sell under $500K. The real test is my sisters townhuse that just went live today on MLS at $740K. Will the expensive stuff still move ?
Funny you mention the price points…that condo down the street sold for 500k or so…I see many of the 700-800k condos taking much longer to sell…even the really nice ones…
Interesting. The condo in my building was listed for $660k. The lower priced ($550k range), smaller units, in my building have taken much longer to sell (several months). We rent a unit that is the same size as the $660k unit - our rent is $1795.00. I freaking love this building, I will hate to move if the owner decides to sell or move back in. But there is no way I’d pay $660k for this place.
Hey lunar, how big are those smaller units? I only ask because a small unit here in Irvine is considered 1bd/1ba 750 sq. ft. or so. These run about 400k, and haven’t been selling well. Once you get around 500-550k you can get a decent 2bd/2ba with about 1100-1200 sq. ft. I’m just wondering since SC county is more expensive than here that your 500k units might be 1bd/1ba and thus not selling well either. I think families are looking for at least 2bd/2ba and that’s why those are moving. IMO.
The smaller units are 2br/2ba, 1200 sq ft. The larger units are 1700 sq ft., and they also include a few extras like fireplaces and four parking spaces. Honestly, I am very surprised that the larger unit sold so quickly (it could just be an anomaly). But the large units only come up for sale every so often because there are so few of them in the building. The small units come up for sale every few months.
A small townhouse in the development next door (2br/2ba 984 sq ft) has been sitting since last year. The first asking price was $709k and now it’s down to $614k and still sitting. I’m sure the $660k unit looked like a steal next to the $614k TH.
I should add that the $614k TH needs a complete remodel and the $660k unit shows nicely. Also, a modest SFH in my zip code would cost close to $850k (it’s a heavily sought after school district).
… and of course, much of the new, and all of the pre-construction is in the domain of the developers, who can afford — and evidently are — lowering the boom to clear inventory. and that boom will hurt a lot of otherwise worldly manhattanites who have seen their apts. appreciate 7 or 8x in the last 10 years (e.g. $90K in 1996 -> $550K in 2006!).
sorry, that should have been 5 or 6x appreciation since 1996. still insane! if that’s not a bubble….
Oh well, of course. Incomes I’m sure have gone up at least 6x since 1996, but certainly not 7x or 8x. That would be crazy. But thank goodness for the 6x income increase, or otherwise we’d probably be in a housing bubble.
Multiply #years times 7% (inflation). Start at 2000. 5 1/2 times 7%. Price in July 06 should be 39% higher with just inflation. Everything above is bubble, NIMBY effect,and other causes.
Local RE section of the local paper in OK.
…Peggy offers great advice to prospective buyers considering a new home purchase.
“DO IT TODAY!” Peggy said. “Don’t wait. In my 21 years of real estate, this is the best time for anyone to become a home ownner.
(Note the atrocious punctuation and sentence structure, I don’t know who is the less intelligent as a group, Realtors or newspaper people.)
Anyway, buy now! There will never be a better time for you to buy! Peggy, with the all seeing eye, she knows things.
Guess I shouldn’t talk:
“DO IT TODAY!” Peggy said. “Don’t wait. In my 21 years of real estate, this is the best time for anyone to become a home owner.”
IS PEGGY SUZANNE’S SISTER??????
Maybe, I’m beginning to suspect that they are all related.
First cousin….and that one eye usually points off in some strange direction, making it real difficult to figure out who she’s talking to.
Are there any readers in Oahu who could give me an idea of the housing out there? How about those new townhomes in the Portlock marina area?
I’m not sure about the Portlock area but still very expensive. Overall the market starting to come down as far as prices and the number of for sale homes on the market balloons from around 2400+ in July last year to 6000+ as of today (based on MLS listings in Oahu only).
You may want to read “New-home sales slowing” http://honoluluadvertiser.com/apps/pbcs.dll/article?AID=/20060729/BUSINESS04/607290318/1071
Thanks Ray. 2,400 to 6,000 is a big difference!
According to the Honolulu Advertiser article, “For single-family homes, the average price was $409,139. For condos, the price was $672,280.”
That’s odd. I guess the condos must be in higher end areas?
“That’s odd. I guess the condos must be in higher end areas?”
It’s true. The only condos being built here are for investors or for mainlanders. We cannot afford these condos that range from 400k+ to 1M+.
For mainland folks, please stop buying so that the prices will come crashing down and we can have some bargains here.
“For mainland folks, please stop buying so that the prices will come crashing down and we can have some bargains here.”
That’s why I ask. I think it is irresponsible of people to buy in high boom areas just because they can - especially second homes - because they are not thinking about the generations behind them who need to start somewhere.
So keep me posted. When there is a glut - we can both buy.
Real estate stats for Honolulu County:
http://www.oahure.com/stats.html.
The site also displays flipped homes. Check it out.
Thanks for the site. It’s awsome. I love the flipper site. Did you see how many flipped in Hawaii Kai? I thought the prices were high last yearwhen we were there, this year it is much worse. Still, it seems like there is much less money to be made by these guys now - most of the money (at quick glance) was made in 2004 by longer term owners probably. I think we will probably be renting there for some part of the year, every year and only buy if/when prices go way down.
Anyway, thanks again. I hope for your sake prices drop soon and you can buy.
From the Arizona article: “Real estate analysts say 2004 is a better benchmark for tracking the housing market’s health. During the first half of this year, there were 29,943 single-family permits issued, compared with 28,731 for the same time period in 2004.”
I don’t remember who predicted that the analysts/realtors would start comparing back to 2004, but they were dead on.
Some of the commenters on this blog are so far ahead of the journalists that I find myself questioning everything I read in the paper now, which is probably a good thing.
2006 may be comparable to 2004, but after all the suicide loan foreclosures of 2007, 2008 is going to be closer to 1999.
more like 1899
http://sfbay.craigslist.org/eby/rfs/186531629.html
Note the address. Lemon.
My friends who built a home in albuquerque, are now having to grade the road themselves, due to shoddy original construction, and building a dirt road, in a developed area, which is not maintained by the city. Listings there have tripled in 5 months. I now live in austin texas, which is still Hot Hot Hot- but I just finally saw a relisted condo- priced 50k less than before. It’s starting to slow here also. I predict it will take properties to be on the market for a year, before people start slashing the prices for real. That’s how long it took us, in the past, when we couldn’t sell a condo. At the end, we reduced the price weekly. We just wanted out.
I moved to Rio Rancho from Austin about 18 months ago. My wife and I were dumbfounded that people would build really nice custom homes on dirt roads (common in Rio Rancho). Anyway, we’re finally getting rain, and several dirt roads washed away. One road turned into a 15 ft deep arroyo. That’s something I wouldn’t want near my foundation.
The construction in my neighborhood has been poor. Almost everyone on my street has had an issue that I’d call a major quality control problem (new roofs, plumbing, redone stucco, major HVAC work, etc.) This rework is on
Oceanside, CA - the most reasonably-priced town in North San Diego County, Coastal region.
So far in 2006, in the under-$500,000 price range, there have been 230 closed sales.
In the same time frame in 2005, there were 406 sales.
That’s a 43% drop-off.
Of the 230 that closed this year, 42% were vacant. Last year was 29%.
If the low-end in the cheapest town in North County is struggling like that……
Jim,
How about Carlsbad, though? It seems to me that the lower end (O’side) enjoyed a much longer uptrend, with greater gains, percentage-wise. Their prices were still going up until late 2005-ish, while the prices in better neighborhoods seem on par with 2004 prices (or lower in the San Marcos-adjacent neighborhoods of La Costa). However, it seems homes are still moving in the better neighborhoods (although at 2004/flat prices).
I think the first-time buyers are priced out, even with exotic loans, and we’re seeing mostly move-ups and multiple-family purchases of SFHs.
I do believe (and your stats show) that we will see a M-O-M increase in sales for July, and perhaps August. Still people out there buying.
Carlsbad, CA - next to Oceanside, and traditionally $100,000 higher for the same product.
Low-end range are those ‘under $600,000′:
2006 69 closed sales
2005 83 ”
20% fewer sales this year.
By contrast, the high-end (over $1M):
2006 101
2005 118
Only 14% fewer
You’re right, the low-end is hurt worse by higher rates/prices. Doesn’t the ‘big squish-down’ start soon though? The point where the desperate high-enders start dumping on price to get out, sucking everyone down with them?
It’ll be interesting, that’s for sure.
The number of sales from now on should reflect how fast prices are coming down, but I’m not sure the sellers are ready to dump. There hasn’t been many yet, just a lot of unsold houses that need to reduce to have a chance of selling. But will they?
Something has to give, and it’ll either be prices or sales. If both go down, it’s freefall time.
Oceanside, CA - overall the closed sales are down 28% this year, compared to 2005.
The low-end is what props up the rest of the market, when it’s eroding, look out below.
It’s also what holds the median down - which explains a lot about the apparent “appreciation” that we’ve been having.
Good point.
I’ll go out on a limb here and predict what seems counter-intuitive. We are still seeing sales, but they seem to in the better areas (and priced lower than peak). I have also noticed a surge of home buying in late June through July (north SD county). I’ve been watching the market like a hawk for over two years, and there is a definite trend of lower mortgage rates = more sales. The psychology has changed, but not enough, yet.
IMHO, Gary Watts might be onto something. He said the second half of the year would be stronger, and I’m going to agree with that, in that the YOY sales volume drops might not be as significant as we’ve been seeing.
Most of us agree that the absolute peak was in the summer of 2005 and the YOY & MOM sales started dropping off significantly around October 2005. So far, we’ve been comparing a very depressed market (this year) to a fairly manic market (first half of 2005). By the time we reach October 2006, the YOY comparisons might not be quite as dramatic. This could lead all the cheerleaders (and MSM) to call the “bottom” and might cause one of the many dead-cat bounces in late 2006/early 2005.
In short, I believe sales declines will be less significant, YOY, and median prices will be flat to slightly lower (but you can buy nicer homes with less money — note problems w/median figures — prices will be down by up to 10-15%).
Be prepared for these DCBs as there will be quite a few at first. The true downturn will begin once the credit standards are really tightened, IMHO. We need the beginning of this downtrend to really take hold (and it is taking hold) before credit is withdrawn in large enough quantities.
Just MHO.
Do you have some kind of retard machine scaning the posts? I posted a fresh and insightful comment and it was rejected as being redundit………… Total bull puckie!!!
Just posted another rejected piece. What kind of software is in charge….. it could be anything with a brain that can read?
You weren’t going to post about Smart Money again? Because Smart Money’s motto is buy low sell……………………..
I never posted about “Smart Money” I just told a story.
Another rejected post. In rebuttle to the follow-up. Need to contact the politburo and get some free speech here.
It seems unlikely that your posts would be deleted but posts complaining about the deletion would be left up.
Don’t know what to tell you, John-Boy. I’ve never had a rejected post so don’t know what software or censorship you’re whining about. Maybe Ben is a better judge of “fresh and insightful” than you are, or is sparing us some tout in the guise of a post.
Amgen has opened offices here in South San Francisco. I work for Genentech and Amgen has set up their offices right down the hill.
I’m seeing more reductions in the South Bay, and a lot of flippers in trouble.
421 N. Prospect, Redondo Beach, listed at 839,000, purchased Sep. 2005 for 860,000.
1704 Highland, Manhattan Beach, listed at $2.1 mil., purchased May 2005, $2.425 mil
228 5th Place, MB, listed at 1.785 mil., purchased August 2005, $1,660,000
1832 Ardmore, Hermosa Beach, listed at 889,000, purchased April 2005, $800,000
1729 Carlson, Redondo Beach, listed at 799,000, purchased July 2004, $725,000
Heh heh. Yeah, I saw that one on 421 N. Prospect. I like how they say in the listing “top of the hill, quiet”. Quiet and Prospect go together like oil and water…
still not down nearly enough though….
Palo Alto, Mountain View, Sunnyvale (e.g. Silicon Valley) - still going strong. Prices are still going up. Unfortunately.
To the person who posted the craigslist link to “Reduced” in the Bay Area - if you look carefully most of them are in the East Bay like Dublin. That’s not what people think of when they think of the Bay Area. They think of where Facebook (Palo Alto), Google (Mountain View), Yahoo (Sunnyvale), Apple (Cupertino) are.
My (former) real estate agent, who sells mainly in Saratoga/Los Gatos, emailed me a few weeks ago saying that “we are currently in a buyers’ market. The inventory continues to climb in the valley. I think we will see either no more appreciation this year, or even a 10-20% decrease in vallues in Silicon Valley. This depends on the price range — highest will drop the most.”
I know it’s the norm here to slam agents, but this guy gave me great advice, predicted in July ‘05 when the market would turn (in Sept. ‘05), and was worth what I paid him when I sold my house in Saratoga (put on market in Sept. ‘05, sold in Oct. ‘05). He told me that the market would turn after Labor Day, and it did.
inventory is going up and price is going down
http://www.benengebreth.org/housingtracker/location/California/SanJose/
if people want to spend 0.7 million to buy a rotten box, let them buy.
you have to think in terms of affordability, not everyone works for google/yahoo/apple.
Here is a recent RE analysis of Silicon Valley area.
http://www.financialsense.com/fsu/editorials/jain/2006/0727.html
Have noticed 2 trends here in rain town…
1) More and more “house for rent” ads actually mean “part of a house for rent”. I see more and more people who are actually looking for other people to move in with them to help pay their mortgage. Given that most people would rather have their own space, I can only assume that high ownership and rental prices are forcing people who can no longer afford either to buy or rent a “whole house”, or to make their payments….to share.
2) Two homes in “nice areas” have recently sported “sold” signs and now both are back on the market. I know for a fact one of them “fell thru” because the couple (from you guessed it…CA), could not sell their home in CA. I don’t know what happened to the other one.
Both of these trends will tend to accelerate the popping of the bubble as the root cause of both trends is the same…..prices are (way) too high.
Ha- I second that. A townhome in my community ($500k, Bellevue, WA) was sold on the market for 2 weeks, but is now back active on the MLS. First time I’ve seen that happen around here.
A couple of folks mentioned “breaking points”…I think for my area that breaking point is $500k. Above ~$500k, everything tends to sit. Within 2 blocks from me, we currently have 3 homes for sale around $480k - $580k. All scandalously overpriced, and all sitting prettily w/o attention.
Some utter insanity in Pittsburgh. A brand new condo high-rise was constructed in Downtown (that’s “dahn-tahn” in PIttsburgh-ese), which I drive past every day on the way to and from work. This is the probably the first in the last 30 years. I’ve never seen any signs of life (such as patio furniture or custom drapes), but I really need to drive past sometime after dark to see how many lights are on.
Today I saw a TV commercial for this place — units start at 275K and go to 1.5 Million.
WTF?!?!?!?!?
Hey, moron condo developer … what the hell are y’inz thinkin’? This is PITTSBURGH! You know, where we drink a shot, chase it down with a beer, and shoot pool. Plus, we generally don’t like condos all that much. We like yards, where we can grill kielbasa and play lawn darts.
This HAS to be one of the all-time most idiotic residential developments in the history of the ‘Burgh.
I laughed at this because what you say about Pittsburgh is quite true!
I lived in Pittsburgh in the 80s. I’ll never forget the beauty of driving home from the airport at night and emerging from the tunnel with downtown suddenly “right there” in front of you…beautiful!
There was a condo on Mt. Washington at that time named (I believe) The Trimont. It was built down the side of the mountain such that every room had a spectacular view of downtown and the three rivers. But as you indicate, condos and Pittsburgh don’t always mix, and it sat almost vacant for a long time. The developer kept lowering and lowering the price and finally gave up and sold it.
The new owner of the building raised the price above the original asking price for the units and conducted a massive marketing campaign. Much to everyone’s surprise, it started selling. I have no idea whether the housing market had changed or whether the problem was really that the units had originally been underpriced. But it’s definitely true that Pittsburgh and condos are an interesting combination.
House across the corner from us has a sold sign on it.
This was listed at $970K, lowered to $920K, sign went up a week ago. I’m not believeing this but stranger things have happened. Similar houses three blocks up are not selling at $659K and $689K.
North Park, San Diego. I’m keeping my eye well peeled to see if it goes thru.
900K in Northpark? Are you freaking kidding me?
I wouldn’t even rent there when I lived in San Diego!
Palmdale 93552 shows nearly 500% increase of listing in larger (4+3) homes that I track.
The median asking price for the same class hasn’t budged in 3 months.
There are still greater fools buying, but the trend is that YOY will go negative in the next month or two, and agter that I expect the bloodletting to begin.
An anecdote, some people I know through church were lured into renting a home from her sister the flipper. Flipper isn’t able to make the nut renting the place and has decided to sell. They are sooooo desperate to sell and can’t understand why they didn’t get immediate offers. Flippers hubbey came over past midnight a few weeks back after midnight screaming and yelling at the renters that they had to leave so the house would sell. This moron doesn’t realize that his renters may be the only thing between him and a BK.
i think i should have posted this here.
we live in frisco, texas (north suburb of dallas) and i am confused at all the talk about a housing bubble in dallas. i do agree that there has been a lot of appreciation in the actual city (downtown) of dallas, but not that much in the surrounding areas. i was downtown at the new w hotel earlier this week and was amazed at how many condo towers are going up. not sure who is going to buy all those 500K+ condos? we built our home about a year and a half ago and the starting price in our neighborhood was 190K. it is now up to 220K, which is not uncommon in a new development. the homes are large with 10′ ceilings downstairs, nice elevations with stone and wood/tile floors. granite counters are standard and the homes range from $75-85/sqft. looking at other parts of the country, i don’t think there is much of a bubble here. the thing about dallas is the jobs pay as much here as the places that are selling homes for $200-300/sqft.
as far as hoa’s go, i have lived in 2 neighborhoods without hoas in phoenix and detroit (i used to be totally against them) and they looked like crap (cars parked on the lawn, unkept landscaping and terrible paint selections). to be honets, i would not live in a neighborhood anymore without an hoa. however, i would look closely at the annual dues and what they cover prior to buying in.
our yard is small (garage in the back), but is large enough to accomodate the pool we had built and still have a grassy area. granted it is not much grass, but a lot of people don’t want a large yard to maintain, me being one of them. i grew up in michigan and we had a huge yard and all i remember is mowing that monster every week. it sucked, especially since my brothers and i usually played in the park.
jmo
joe
Glad you had a positive experience with the HOA’s. Me, personally, I don’t prefer to live under the thumb of a quasi-government that can fine me or seize my property if I don’t park my car where they want me to, or mow my grass to their specifications. I guess that’s what separates us.
From my local observations here in central/eastern Connecticut- The Courant’ article is too optimistic- prices have hardly risen in a year- and that inventory number is the same as in early 1998- which was just one
I only see the inventory growing into 2007.
In 1998 we where but one year into a real estate recovery- after a 7 year downturn (1989-1996).
We may not Perhaps have the meltdown they are having in CA,AZ NV FL and the DC area, but prices are likely to fall at least 10% for condos and SFH. Which will probably cause the state fall into recession.
I am wondering how much of a bubble we have here in Colorado Springs. There is still a significant amount of new home building going on, and the job market here is just not that strong.
We bought this place (five acres north of the Air Force Academy with a plain house) in 1992, and thought we were buying in a seller’s market then: nobody bothered to clean up the country properties for sale, and they mostly went under contract within a couple of weeks of being listed. Our offer was a backup offer that was accepted when the original contract on the house fell through due to a title cloud on 1/4 acres of the property.
Elaine,
The housing bubble here in Colorado Springs never reached the lunacy seen out of east and wests coasts, but all the signs and portends point to a major correction. The foreclosure rate is skyrocketing, and most people are so deeply leveraged in debt, with no savings to speak of, that they’ll be severely squeezed by rising ARMs and any drop (or plunge) in home prices.
I’m remind of the scene from “Shawn of the Dead,” where Shawn leaves his house to buy a paper and doesn’t even notice the undead zombies (FBs, in our analogy) lurching past all around. Just part of the scenery…but by Sep/Oct, I think we’ll see the first wave of distress selling, when the promised “buy in time for school” buyers fail to materialize and more and more FBs start hitting the panic button.
Take a look at the massive Cape Cod inventory explosion. Inventory going up at a straight 45% angle plotted on a graph. Take a look here
Houses in my neighborhood have been sitting with signes for months.
Central CT
One of my guilty pleasures is listening to the real estate shows on talk radio. It’s fun to listen to these weasels squirm. They are shameless. I’ll post an update.
They’re still pushing interest only and option arm, encouraging people to “pull out equity”. These guys are unbelievable. Also they claim that they play “the role of a financial advisor.” Real Certified Financial Planners can’t make promises about the stocks, bonds and funds they are selling always going up.
These guys should be prosecuted for fraud.
Now they’re saying that the appreciation has been unrealistic, but it’s still a great time to own a home.
It’s consistently, year-over-year appreciated 6% is the new line.
This guy’s favorite line is that “unutilized equity” is a “dead asset.” He’s encouraging more and more people to take on seconds. My God these guy is a
He’s pushing a $1 million dollar loan with a $2600/month payment. (Of course, that’s neg-am, but who pays off their mortgage anymore).
A guy with a 6.2% interest rate on a $250k loan called in. The used-car salesman encouraged him to buy a triplex by “pulling cash out.” He wants to buy a 750k loan triplex, units renting out at 1550 (supposedly).
The loan-salesman said he would lower the payments and give him another loan, and his payment would go down…option arm anyone? No mention that he’s not paying down principal and that it’s actually amortizing negatively.
He’s promising that his net worth will double, his “portfolio” is diversified (this is truly a crime, if I own Bank of America stock and I buy on margin to buy Citibank stock, that’s not diversification) and the payments will lower. The thing is, no broker in the world could get away with this in the equities market.
What a sleazeball.
A guy called in who purchased in Valencia within the last year, 0 down. He’s probably underwater already. Purchased for 600k, supposedly it’s now worth 750 (unlikely). 6.5% on the first, 9.75% on the second, he’s paying about 4200/months. He’s telling him to combine the first and second, promising to cut the mortgage payments to about 1700. By the way, he doesn’t have good credit (620). The MB said he considers this credit “perfect.” And he can do stated income.
866-355-6200 is the phone number they’re giving out. If anyone wants to call and further report on this Ponzi scheme, not a bad idea.
Now he’s talking about how he likes to “give back to the community.” What a sleazeball. He’s explaining how he had to file bankruptcy in the past, and that’s why he understands and wants to help. Says that it was “a great thing.” Sometimes I dislike the schaudenfraude on this blog, but if there’s anyone who deserves to go BK again, it’s this guy.
Next up, the real estate shill who’s always talking about her Cadillac.
Here’s her website, http://www.ellenkatzman.com/
She described a “shift in the real estate market.”
She purported to quote the LA Times as saying that the sky is not falling, etc. “Industry analysts” are saying that the factors that led to the crash in the 1990s are not present, demand will not slow down. (I’m sure the “analysts” were Watts, DL, LAY, etc.
Median is up in OC, LA, move back to “normal” results in an “unnecessary panic.” (No mention of SD, of course.)
Warns against putting the market at inflated prices. People are doing that and “skewing the statistics.” What a joke.
She’s telling buyers that there are “amazing values,” but “you can’t insult the seller.” Why not?
Example, buyer lowballed at 850k on a home priced at $1.03 mil. (Nice, one of the readers here, perhaps.) The seller refused to counter. So what?
Tips she offered: sellers, give a good first impression. (No more feeding the squirrels, I guess.) “Perk up your house.” (Ellen, they need to reduce the price, period.)
Buyers, if a house “is tired and sad” but has a “great floorplan”, it could still be the home of your dreams. [Huh?]
She said, “hypothetically,” if the “doomsayers are right,” you should eat a dozen Krispe Kremes and max out your credit. [Great advice, if you look at her website, it looks like she secretly thinks doomsday is coming, judging by her photograph.]
We live near Oakhurst CA, a tourist/retirement community on the southern route to Yosemite, with a healthy dose of locals as well. We’ve had 100% appreciation in the last four years, fueled by transplants from both LA and the bay area. I drive through the residential areas of town once a month or so. In the last month the for sale signs have more than doubled. I was surprised to see the selling hitting our area so quickly, as we usually lag by 6-12 months.
A frustrated real estate agent wrote in, the sellers refused to lower the price, and the house wouldn’t sell (in Glendale). She encouraged the agent to not be afraid of the truth. [In other words, reduce the price, but she couldn't come right out and say it, a lot of talk about "motivation. Said the agent should let the listing expire.]
Went to visit my sister in Jacksonville. There is a neighborhood that backs up to I-95 with a huge banner that says “Buy Now, no payments til 2007″. I thought they only did that with furniture.
Sold sign on the house down from my rental, also sold sign on house across street. I will have to Zillow these houses to see what they sold for. See whats going on. Still many homes for sale in neigborhood.
For the past two years David Weekley homes has had no inventory in the Tampa area. If you go to their website their are many spec homes in each community.