“The Most Normal Market We’ve Had In A Long Time”
The Daily News reports from California. “Home sales and prices in the Santa Clarita Valley continued to plunge. Sales of single-family homes fell by 22.1 percent, which amounts to the lowest number of November resales since 1999, according to the monthly report issued Friday by the Southland Regional Association of Realtors.”
“The median price was $580,000 down $15,000 from November 2005. Condominium sales, and prices, also were on the decline. Eighty-eight condos sold in the region with a median price of $365,000. That compares with the 100 that sold a year ago with a median of $385,000.”
“Sales peaked in March 2005 when 662 houses sold. The highest median price, $643,000, was recorded in April of this year. The best month for condo sales was in January when the median hit $397,000.”
“‘I’m happy with the market,’ said Peggy Mueller, president of the association’s Santa Clarita Valley division. ‘The people who are buying really need to buy and those who are selling really need to sell. It’s the most normal market we’ve had in a long time.’”
The Signal. “The market in Santa Clarita is gradually adapting to other regions in Southern California, the Southland Association of Realtors reported. The 1,560 single-family resale homes listed for sale is 77.5 percent more than the same period last year.”
“Active listings for condominiums doubled to 624 since last year. Jack Kyser, chief economist for the Los Angeles County Economic Development Corp., said condominium developers have canceled their developments, and have been looking to rent condominiums rather than sell them.”
“However, he said that for resale, ‘It’s definitely a buyer’s market. The speculators have left the market, which is good news,’ he said.”
The Merced Sun Star. “In 2005 the city issued a record 1,382 permits for single family houses. This year the market is saturated with new inventory and builders slowing down. The slowdown’s effects can be felt at building-related businesses across the county.”
“Chuck Falkenstein, general manager of Central Valley Concrete, said new houses made up about 80 percent of his business last year. Today that part of his business has shrunk to less than 10 percent, he said.”
“Anthony Fragassi, manager of 84 Lumber building supply on Highway 59, described business as ‘nonexistent’ compared with last year. Fragassi said his employees made 20 to 30 deliveries a day in 2005. Now it’s down to half or less, he said.”
“In the summer of 2005, Centex was closing escrow on eight to 10 houses a month, Rodriques said. A year later, Carly Rodriques started hearing about layoffs in Centex’s marketing and accounting departments. The employees in Rodriques’ construction division figured their jobs were safe, she said.”
“‘(We) thought we were out here actually doing the work to make the rest of the company run,’ Rodriques said. ‘I don’t think the construction people had any concept that it would happen to them.’ Her job disappeared, the casualty of a ‘massive work force reduction’ at Centex, a letter from corporate headquarters told her.”
“The market is still adjusting. Builders are using price cuts or incentive packages up to $100,000 to move the new inventory clogging the market. ‘This is my fourth cycle like this so I knew it was coming, but I didn’t know it was going to be this bad,’ said Bob Rucker, owner of Rucker Construction. ‘This market is totally overbuilt right now. The national guys came in and swamped us with inventory.’”
“Summerton Homes’s Don Gray said builders are fighting a battle against the public perception that now is a bad time to buy. ‘We think that’s a misconception,’ Gray said. ‘Prices are down about as low as they can go, interest rates are very strong. We think houses should be flying off inventory.’”
The Union Tribune. “Frank Christopher arrived at the Manchester Grand Hyatt yesterday with his wife, intending to buy a million-dollar condo-hotel unit from Donald Trump. The semiretired custom-home developer from La Quinta and Jackson, Wyo., left with two, costing about $2 million and totaling 3,800 square feet. ‘One’s for speculation,’ said Christopher.”
“An estimated $120 million in sales was toted up at Trump’s latest project, Trump Ocean Resort Baja California, a three-tower, 570-unit development north of Rosarito. Some buyers acted through on-site agents who, with cell phones in hand, signed sales contracts and handed over cashier’s checks for 10 percent down.”
“Marc Penso, an Irvine real estate attorney, was blunter than most in expressing his motivation. ‘Everyone here is buying for speculation; there’s no one moving here on a permanent basis,’ Penso said, adding that he owns similar units in Aspen, Colo., and Mammoth and is buying one at The Residences coastal condo-hotel in Tijuana.”
“Penso is betting that Baja’s relatively low home prices, at least compared to Southern California, will continue to fuel the boom and give him a tidy profit. ‘Everyone in this room is doing this as an investment,’ he said. ‘There’s no one here who’s going to own these units in five years.’”
“The Donald did not show for the one-day sales event at a plush San Diego hotel, but his persona loomed large in the ballroom, where would-be buyers nibbled on biscotti and sipped espresso as they waited to make their bids and celebrated over sirloin tip and fish tacos after clinching the deal.”
“‘Trump is my idol when it comes to real-estate investments,’ said Med Sami, of Irvine, after forking over $431,000 for a one-bedroom.”
“Trump’s imprimatur was just what many needed to take the plunge, said Jason Grosfeld, a co-founder of Irongate. ‘When The Donald is willing to put his name on the site, that means a lot,’ he said.”
“Buyers in the predominantly Southern Californian crowd said Trump’s involvement eased concerns about owning land in a foreign country. They were undeterred by spiraling violence in the border city of Tijuana, and they paid no heed to protesters outside the hotel who said Trump’s property was on one of the most polluted beaches in North America, a charge the developer emphatically denied.”
“‘I’m sure he wouldn’t put his name on it if he hadn’t investigated northern Baja meticulously,’ said Tom Pfleider of Beaumont, who dropped $550,000 for a one-bedroom on the 11th floor.”
“‘I’m sure he wouldn’t put his name on it if he hadn’t investigated northern Baja meticulously,’ said Tom Pfleider of Beaumont, who dropped $550,000 for a one-bedroom on the 11th floor.”
Yes. After taping a show and before his appointment to get his hair messed up I’m sure he investigated northern Baja meticulously.
It certainly does mean a lot when Trump puts his name on something. It means imminent bankruptcy. Hey, I wonder if some guy with multiple DUI and reckless driving convictions could start a driving school with his name on it, just because he is a pompous ass. That’s pretty much what Donald has done with real estate.
Can we mark this as the hallmark of the RE folly?
The “Epitome of Real Estate Fools?”
Just make sure the guy’s daddy buys the real estate school for him. Trump would be nowhere if it weren’t for Daddy Trump.
I meant buy the Driving School for him. D’ohhhh!!!!
But you get the picture. All of these dopes that act like Trump is such a real estate genius don’t have the first clue about how he got where he is. A fool and his money…..
Ivanka is buying in too
Trump’s daughter Ivanka was one of the first buyers, snagging a two-bedroom junior penthouse, said Roxanne Loughery of S&P Destination Properties, the sales agent.
but this gut is looking for a quick in and out, as are the rest
Marc Penso, a 46-year-old investor from Irvine, said he didn’t plan to keep his new two-bedroom. He is betting that Baja’s relatively low home prices _ at least compared to Southern California _ will continue to fuel the boom and give him a tidy profit.
“Everyone in this room is doing this as an investment,” he said. “There’s no one here who’s going to own these units in five years.”
That’s what they think.
The bank will own them.
Ivanka is a shill for daddy.
I have driven to Ensenada 3x and 2 times have been stopped by Police in Tijuana and shooken down for 25 to 40 dollars.I would hate to go down there often to vacation in my 400k investment.
Excellent anecdote! See my comment a couple of posts below, made before you independently corroborated it…
Sometimes going down to Puerto Nueva, you’ll see Mexican Army kids, in their late teens, M16’s @ the ready, on the road…
Just a little disconcerting~
Added bonus:
About 5 years ago didn’t a bunch of gringos have their Mexican properties taken away from them?
bottomfeeder,
Sounds like an experience we had the last (and I mean **last**) time we were there. For absolutely no reason at all (we hadn’t been drinking & look very “square”), we were pulled over by a group of “police” and they tore everything out of our vehicle & interrogated us for a couple of hours. Absolutely NO reason given. They didn’t take any money from us, but it was an experience we don’t want to relive, again.
No way I would “buy” something in Baja. And, yes, they took some land away from a group of Americans a few years back. Gave it back to the Mexicans who claimed the land was theirs. Good luck with those condos!
Buying condos in TJ?…wow. What’s next, Cali, Columbia?
“Trump’s imprimatur was just what many needed”
Yes, it means you’ve been deflowered by the master.
Funny, I put the word Trump on a piece of paper, cut out all the letters and put in a hat and dropped them on the floor…. It spelled ASS Ho*e.
Seems a piece of paper is smarter than the FB’s
“There’s noone here who’s going to own these units [in Baja] in five years” … Perhaps the bank will own them all by then.
“The speculators have left the market [in Santa Clarita]“… yeah, the self-conscious speculators left for Baja, but the people who are buying in Santa Clarita now are speculators too, whether they know it or not.
Did they change the law in Mexico recently allowing Gringos to purchase land on the coast? What exactly are these people buying?
Let’s see if that law protects the Gringos once some tinhorn revolutionary in the Hugo Chavez/Commander Marcos mold declares himself Mexico’s new El Supremo Grande. Adios, Gringos, and muchas gracias for those swank new condos — they’ll make fine barracks for our revolutionary cadres!
Skip:
Yes, Gabacho’s can own a trust at a Mexican bank as the sole beneficiary of the RE held in that trust.
Hope those Mexican Banks hold up, and no socialist revolution takes place.
“…and is buying one at The Residences coastal condo-hotel in Tijuana.”
Because everyone knows that TJ is such a fantastic getaway for the wealthy and affluent. Its beaches rival those of the French Riviera- especially when the sewage overflows into the Pacific and the e.coli is in full bloom.
Too bad you have to run a gauntlet of gunshots and face the risk of arrest on false pretext for bribery extraction purposes as you pass through Tijuana on the way to your McTrump condo.
And may whatever you believe in aid you if you get into an accident and need real medical care while driving. I know someone who was in a car accident down there a few years ago. He was practically held hostage after being critically injured in a one car accident. The idea was to extort damage money out of him. Buying insurance for driving there is such a joke. It took two days before he could be sent to a hospital in SD for proper treatment.
I got shook down in TJ once, and swore to myself that I’d never, ever, cross that g!dd@mn border again. “Senor, you have broken many Mexican laws.” Took me 20 minutes to figure out that the sum-total penalty for “breaking” all of these laws was a $20 fine, payable directly to him. Oooooh, and he wore reflector sunglasses, so I couldn’t see his eyes. Really, really, pissed me off.
The streets in TJ smell like urine. It’s either all the homeless people pissing in the streets, open sewers running through the city, or it’s the smell of the gawdawful alcohol they serve in all the bars with the open doors.
Note to neophytes: Don’t go to TJ. And if you do, don’t eat or drink ANYTHING. If you ABSOLUTELY MUST drink, make darn sure it’s high enough proof liquid to kill anything in its path. And if something goes wrong in TJ, remember I told you not to go.
TJ is still the nastiest city I have ever visited, and I’ve been around the world. My friend who’s been to India compares it to Indian slums.
Ensenada is substantially better, but that doesn’t make it “good”.
I have been to TJ more times than I can count, mostly to have a few beers, but I have also eaten food there. I have never once gotten sick. I have also driven to Rosarito and Ensenada and have never been accosted for $$, maybe I was lucky.
Having said that. I would NEVER be putting my money into a Trump condo investment in Rosarito, nor would I ever piss away money on a condotel in TJ. Some people are just friggin insane when it comes to throwing money out the window. TJ is dirty, so is Rosarito. I agree Ensenada is better, but it is still an entirely different world from what these “investors” are used to.
I know a time share salesman who talked for years about selling condos in Baja Mexico. Finally, last year he dragged his wife down there with much fanfare. In about six months he was back at his timeshare job, hat in hand, broke, and someone had tried to steal his car.
A year ago my wife and I were coming back from New Zealand and our car was @ a friend’s house in el lay and we took a 3 hour shuttle ride to the SFV that shoulda taken us an hour, (the freeways don’t exactly flow like honey) and one of our fellow travelers, a 51 year old good ole’ boy from Alabamastan (his description) got to talking with us and he’d spent his 49th and 50th years in the National Guard in Iraq (yes, we are scraping the barrel) and I asked what it was like and he said: “Have you ever been to Tijuana?” and I said yes and he said, Baghdad is like Tijuana, not as functional, however…
Well I guess the greater fools are alive and kicking .
These are speculation buys at the Trump Baja project so I’m wondering who is going to finance them ,also being out of country and all . Never would of figured that there was that many fools left in the high rise condo vacation spec. market .
Nice to see the Union Tribune getting right in there and help Trump pimp this project, isn’t it?
The “Art of The Deal ” ,never mind value for the dollar when it comes to Trump .
Only time will tell. Meanwhile, we wait for bargains to wash ashore. They will. Patience. I have learned one thing through all of this. We are preyed upon for short-term greed and belief that we have scarcity of things. All we have is a bunch of haves and have nots and a few in between that are trying to mind their own business and not get ambushed by the monied class and wannabes.
I was reading the Valley Voice, really an excellent giveaway newspaper, from the Central Valley of California and they’ve got a real estate section and all the adverts from the housebuilders and the maps, with the locations of their housing developments, almost look like a battle plan from the Civil War, different encampments, here and there.
Centex had an advert that says “The market has re turned” with the “re” in red, the rest in black. Who are they trying to kid?
If you say it or put it in print, it must be true school of thinking?
If it were true, they wouldn’t pay to say it in an ad.
If it were true, they wouldn’t pay to say it in an ad.
Tell that to this Central VAlley homeowner, who keeps dropping their price:
http://bakersfieldbubble.blogspot.com
Finally got my new template up and running:
Sacramento Area Flippers In Trouble
Ditched the dhtml, added more ads.
For all the housing bubble blog fans out there: Support your favorite bubble blogs!
Forgot to add:
Total FIT listings in Sacto: 492
I didn’t think we’d hit 500 by the end of the year. To put this in perspective, that’s ~ 5% of all listings in Sacramento. 1 in 20 listings are FITs!
I’m the guy compiling the stats, and it blows me away.
Max, I was the dude who sent you some FITs for 95827, and I keep seeing some houses not on your list. I think you only have half the actual flippers in trouble shown.
I just added an FAQ that should answer your questions:
Flippers In Trouble FAQ
I like what you have put together. Of course the % losses are asking prices which probably will be negotiated down, but it does at least put out a sampling of actual properties and actual percentage losses rather than “median down 2%” BS.
Total Loss: $620,000 Percent Loss: 31.0%
Asking Price: $1,380,000
Bedrooms:5 Baths: 4 Sq. feet:5265
Asking Price Changes:
Down 17.6% from $1,675,000 On 05-12
Down 8.0% from $1,499,500 On 06-16
Down 0.4% from $1,385,000 On 07-15
Previous Sales:
Sold on 2006-05-03 for $2,000,000
Wow! I would wager that this one was big-time mort fraud. The last “buyer” probably raked in a cool 1/2 mil cash kickback from the seller on this one. Why rob banks anymore? It’s so passe.
Hey, it worked (at least for a while) for ex-Congressman Randy “Duke” Cunningham, just down the way here on Del Mar Heights Boulevard.
Of course, now the “Duke” is known as “Fresh Fish”.
Fraud deal . You can just tell by how quickly it was re-listed .
Down 600k in 5 months ? come on
People losing $100,000+! I make a decent income but if I lost $100K I would as ’sick as a parrot’.
“The Most Normal Market We’ve Had In A Long Time”
I think most of us here on this blog would love to be able to buy a reasonable home to live in and raise our families, but with prices still twice underlying and affordability levels we cannot or will not. What part of anything resembling normal do we see in todays Real Estate market? I recon that this market will not be normal for a long time, perhaps years.
“‘I’m happy with the market,’ said Peggy Mueller, president of the association’s Santa Clarita Valley division. ‘The people who are buying really need to buy and those who are selling really need to sell. It’s the most normal market we’ve had in a long time.’”
That’s a normal market? Normally, people can sell want to sell not “really need to sell.” I don’t think her definition of normal and mine are the same.
Its almost like everyone is trying to delude themselves as they go Christmas shopping (today’s task, ugh… I’m not a shopper.)
We just had the sub-prime mortgage brokers pull back. That was huge, but it will take 30 to 60 days for the market to even acknowledge that sales are falling through as previously “pre-qualified” buyers find out they aren’t qualified anymore. That should be some interesting press…
Then the upgrade market will slow some more…
Just in time for that alleged “spring bounce.” This year’s spring bounce has Peter Cottentail jumping off a cliff. He’ll have the same sort of spring bounce as Willy E. Coyote.
Neil
The Most Normal Market We’ve Had In A Long Time”
No Christmas party this year. The leading realtor in Santa Clarita usually has a formal year-end party at the local CC, I have still not received my invitation. 183 homes sold in November- No way can that support the RE industry.
Its the current meme; “normal” as in:
“its NORMAL to have half the houses for sale not sell when there are half the buyers as before”.
I dunno, maybe I spend too much time on this site. But aren’t people aware of the state of the condo market?? The speculators and investors…gimme a break. The people are in for a rude awakening.
As someone said here, Trump is the PT Barnum of the real estate industry.
Trump is the king of BK. Why should his name add any cache at all to these flops? There’s a sucker born every minute.
Its the same crowd of people who believe there is such a think as a high quality toupe. You do understand that’s Trumps primary market?
I think you misspelled BS?
Yes, BK and BS.
Good ol “P.T.” Trump had some high-profile BKs in the past. Why people follow this guy’s advice still amazes me.
The trump project in tampa (he just sold his name, has no investment in it) still hasn’t started going up after two years and is now slated for 2008.
If you buy one, they will build it…
LOL .
for you playahs in the HB stox:
http://tradersinsights.com/blog/2006/12/06/revisting-the-technicals-of-the-homebuilders/
This “bull” sounds like he could use a testosterone injection…
“However, just to put this in perspective, when the housing market was on a roll thru 2004 and 2005, the average housing health level was +18% to 23% so we are now basically in the midst of a housing decline equal to the rise that occurred over the past few years.
Is this showing up in the chart? If you look at the Charts of the homebuilders, no way! If it were, I think you would see action in the index like the Nasdaq over the past 4 years – sluggish at best. In looking at the HGX, this is not the case and the move continues higher as this is written. So I guess we are in one of those situations where the fundamentals better improve or these stocks are going to be drilled. Till that point, I guess I will hold my bullish stance (but trail with stops).”
Couple more linx:
http://www.frontlinethoughts.com/printarticle.asp?id=mwo120806
http://www.americanprogress.org/issues/2006/12/end_of_the_boom.html
http://www.youtube.com/watch?v=beCqrEOjXss
http://www.rgemonitor.com/blog/roubini/162056
That guy on youtube does a nice recitation of the affordable housing party line: “Anybody who wants to buy a home is entitled to easy credit,” or somesuch. Hasn’t this philosophy put enough households on the path to bankruptcy by now for at least a few housing economists to figure out the perils of giving any size loan to anyone who can fog a mirror?
Easy Credit = Military Intelligence = Jumbo Shrimp
I guess getting it might be easy. Paying it back sure seems like a bitch for some people.
“Summerton Homes’s Don Gray said builders are fighting a battle against the public perception that now is a bad time to buy. ‘We think that’s a misconception,’ Gray said. ‘Prices are down about as low as they can go, interest rates are very strong. We think houses should be flying off inventory.’”
LMAO. Good luck finding a GF!
There has never been a better time — to catch a falling knife!
We think houses should be flying off inventory.
Of course they think that, because otherwise they’re screwed.
From an evolutionary biology and socio-biology perspective.
They have to believe that to be successful in capturing a GF.
The human BS detector has been refined over many millenia and if the seller didn’t convince himself to believe with every cell in his body that “houses should be flying off inventory” he would never sell anything as people can detect a liar in that context.
‘This is my fourth cycle like this so I knew it was coming, but I didn’t know it was going to be this bad,’ said Bob Rucker, owner of Rucker Construction. ‘This market is totally overbuilt right now. The national guys came in and swamped us with inventory.’”
Blame the national guys, Rucker. You must not have built any houses for the last 6 years, so you have no blame. (If you were smart, knowing that the cycle was coming, you should have sold your business 2 years ago and retired.) Three previous cycles and still no clue and soon no business.
Rotsa ruck, Rucker! Scooby-dooby-doo!
Let’s try to make logical sense out of this story:
A = “Home sales and prices in the Santa Clarita Valley continued to plunge.”
B = “It’s the most normal market we’ve had in a long time.’”
A & B together = “Home sales and prices normally plunge.”
These realtors seem to think that people losing thousands of dollars ,or tons of foreclosures coming on line mean its a happy happy time normal market .I guess if sales people are still making sales they are happy ,never mind the people that got left in the dust and buried by buying in the last 2 years .
I use to know a car salesman who told me that when they got a buyer to overpay for a car they would “bury him “.
I think you left off: “..QED..”
Sorry
“Gray said. ‘Prices are down about as low as they can go, interest rates are very strong. We think houses should be flying off inventory.’”
My wife and I were at a ‘Holiday’ party for her work the other night. Although we’ve been tending to shy away from conversation about real estate (to keep my bubble mouth from running off), we ended up talking about RE with two couples at the party.
One couple, who had bought a relatively expensive house about two years ago, admitted that their house was probably worth what they had paid for it two years ago. The funny thing is, that when they found out we were renting, the wife spent quite a bit of time trying to illustrate to my wife and I the folly of our renting ways. The wife even went so far to say that “there is a stigma against renters, after we bought, people came around with gift baskets, etc.”, and that we need the tax savings from the interest deduction. The interesting thing was how much the wife was trying, almost *needing* us to admit that renting was not a wise decision. She was a little taken aback when I told here that our monthly expenses were *half* what they would be if we owned up here, and that we actually owned real estate elsewhere…in other words renting not because we have to, but because we decided to (we probably make the same yearly salary as her family).
The other couple patted us on the back for renting. The wife is the business editor for a regional paper, and she was astounding me with her predictions of massive re-listings come spring time (i.e. exactly what some of us on this blog have been predicting). However, her bullishness ends in spring/summer 2007, when she thinks the bottom will be reached. She thought that the spring ’07 inventory ballooning season would be the best time to buy.
All in all it was an interesting evening, at least for getting some additional perspective on the current sentiment on the housing market direction.
Thanks for the update.
It amazes me how no one today can do non-dimensional math or even simple dimensional ratios. The business editor sounds smart, but why would the trend end in spring? Let’s look at:
Price to income
Units on the market to monthly sales rate
Fraction of California income spent on mortgage payments
Not to mention historical correlations…
So let’s go into spring where we’re going to break a year’s inventory in most of the USA. That’s 12 months… I see the vernal equinox (start of sping) occurs at 00:07 on 21 March 2007. So we’ll use that as our starting date.
Once home break 8.7 months (according to correlations I’ve read on the web), prices start to decline and keep declining until inventory drops below 4 or 5 months of inventory (where it often stabilizes for years, sometimes after a small recovery).
If inventory hits 12 months in spring, it doesn’t hit 4 months until 2008! (Assuming not one more home enters the market and sales rate is constant.) Yes, summer sales could be faster (won’t be, due to sub-prime mortgage tightening…), but then again, more inventory will enter the market!
Come on. Southern California hasn’t had home construction like this since 1990.
Oh wait… Santa Clarita has 4 major tracks that I know of. Redondo and Manhattan beach are converting warehouse and office space to condos faster than I can type. Irvine… well, the OC is just toast.
And we haven’t even begun to discuss job losses. Since so many of those job losses are “independent contractors,” you and I both know those losses don’t show up in the statistics…
Normal market… Not!
Neil
I think the editor is probably trying not to ’see it out loud’, so to speak.
Doesn’t do to piss in the punch bowl when you’re hooked to advertising.
“The Donald did not show for the one-day sales event at a plush San Diego hotel, but his persona loomed large in the ballroom, where would-be buyers nibbled on biscotti and sipped espresso as they waited to make their bids and celebrated over sirloin tip and fish tacos after clinching the deal.”
Does feeding them biscotti, sirloin tip and fish tacos help GFs to fantasize that they are just as good as Trump at negotiating a real estate deal?
This whole bubble has a big emotional aspect to it:
1. You got priced out; I’ll be living with the rich people.
2. People look down on you when you rent. You won’t be invited to parties.
3. Buying a house means that you are not throwing money away on rent.
4. Investing in real estate means that you are one of the big boys now, Like The Donald. after all, 107% of all bajillionairs made their money in real estate.
It’s the same with any “product”…appeal to the lizard brain, and you don’t have to worry about facts or truth.
“appeal to the lizard brain”
Sorry to pick on poor Gekko, but isn’t that the name for a type of lizard?
http://rdanderson.com/features/gekko/gekko.htm
Gecko’s are amphibian’s not lizards.
No, they’re not.
http://en.wikipedia.org/wiki/Gecko
Damn, I missed some good food!
I wish I was there to dine, chat about the bubble and then go home.
“Does feeding them biscotti, sirloin tip and fish tacos help GFs to fantasize that they are just as good as Trump at negotiating a real estate deal? ”
I’ll bet it does, yes.
Holy smoke! I watch the Southern California housing market very closely and I see the local listings through Sandicor/MLS/Zip Realty and something happened in the last three days that I have NEVER seen before. Pardee Homes, who is the primary builder in a large area of North San Diego in the coastal area, just dumped 30-40 new contsruction homes onto the market using the MLS. This has not happened in the 15 years I have been watching the market. Typically new construction neighborhoods by Pardee and other builders have “phase releases” where one to five home are releases at a pre-selected date and there are always enough buyers to absorb the homes released. Well not anymore and Pardee is flooding the local market with them now. If you want to see them, go to ziprealty.com and then type in 92130 zip code and you will see 30+ of them in the last 3 days. This is the kind of thing that will further kill the San Diego housing market in 2007. Worst of all, there are still lots of builder incentives on these listings…which will further crush resale pricing in the area.
Great observation!
Those accompanying photos are a dead giveaway of a massive inventory dump — nothing but empty frames with the text “Waiting for photo from seller’s agent” inside of frame after frame.
Oh, and if that is not enough of a giveaway, the newly-dumped inventory is also flagged with “New construction,” something I have never noticed on any other ziprealty listing. This must be the new home development along SR-56 which perpetually flies the massive balloon overhead with the words “New Homes For Sale” on the side? There is nothing to push down prices like advertising that inadvertently signals “Fire sale in progress.”
Buy now before we torch the buildings!
Interesting too that it is happening in December, the slowest real estate sales month.
Highway 56 has been open just over two years connecting Poway to Del Mar, more than enough time for the new housing stocks in Carmel Valley to come to market…and at just the right time, too.
http://www.nctimes.com/articles/2004/06/27/news/top_stories/22_27_066_26_04.txt
In Valencia (part of Santa Clarita, zip 91355) there is a home listed in the MLS for $490K. It last sold in August 2006 for $525K. That’s a 6.7% drop in four months!
I still think that prices will be sticky in a downturn (like in the 1990s), but perhaps not so much for motivated sellers.
(By the way, when quoting prices and rents on this blog, it helps to indicate the zip code or city/state.)
“Home sales and prices in the Santa Clarita Valley continued to plunge. Sales of single-family homes fell by 22.1 percent, which amounts to the lowest number of November resales since 1999, according to the monthly report issued Friday by the Southland Regional Association of Realtors.”
—————-
This, while the population of SC has increased appromately 30% in the same time frame.
The new homebuilders in Santa Clarita are discounting their inventory much lower than the existing homesellers. There are several homeowners in new home developments who are listing their “used” houses higher than the new homes, without the upgrades and incentives. Look at Stetson Ranch by Hovnanian and Montage by Beazer Homes to name a few. It was so tempting to buy but wiser minds on this blog made me gun shy. Prices in Santa Clarita need to fall much harder. Heck, parents find it hard to contribute $5.00 for a classroom activity donation. The classroom mom had to send several notes for people to contribute for the teacher’s gift. If that does not mean “stretched budget” then I don’t know what that is. They will buy a $600K house and live on Ramen.
“Trump’s imprimatur was just what many needed to take the plunge, said Jason Grosfeld, a co-founder of Irongate.
Yuk! If I got any of Trump’s imprimatur on me I would be willing to take the plunge all right, straight into the tub to wash it off with ajax.
the financing for property in Mexico is much higher interest rate wise than in the U.S.
I am going to experience the purest form of schadenfreude when some of these bagholders-to-be show up on a future “60 minutes” episode, wailing uncontrollably and cursing “The Donald” as they spill their tales of woe.
Here is someone trying to unload a condo in San Diego.
Rent Or Sell?
Not too long ago I remeber Baja Home owners burning their homes when Mexico took them back. Claiming the property was sold by somebody who didn’t own the land. Sure they were. Thats the Mexican way.