‘We’ve Got A Shortage Of Buyers’ In Milwaukee
The Milwaukee Journal Sentinel reports on a familiar housing bubble scenario. “Metro Milwaukee’s existing-home market posted a robust 1,155 sales last month, amid a landscape littered with ‘for sale’ signs. The highest February volume in three years didn’t totally offset a sluggish January, however. Sales are down 1.6% so far this year.”
“This year’s 5,914 newly listed properties and 2,090 sales compare with 4,543 new listings and 2,124 sales in January-February 2005. ‘We’ve got a shortage of buyers at this point,’ said (broker) Betsy Wittenberger in Hartford. ‘But sellers are not real eager to bring prices down. They’ll accept a longer time on the market, which is what it’s looking like we’ll have this year.’”
“Sensing buyer caution, many sellers are hedging their bets on a home deal, Wittenberger said. ‘People are putting their homes up for sale, but not necessarily moving forward on buying another house. That means they have very little risk.’ It also means ‘a lot of contingent offers,’ in which sellers won’t buy a new place until certain they’ve sold their own place, she said. ‘We’ll have to muster more patience this year,’ she said.”
“Sellers can no longer name their price, Metro MLS President Tammy Maddente said. ‘We’re still seeing about a 5 percent increase, but not 20 percent anymore,’ said Maddente.”
“MLS’ Monday report shows that in the first two months of 2006: New inventory is up anywhere from 11.9% in Washington County to 40.4% in Racine County, compared with 2005. Most counties have 20% to 30% more dwellings on the market this year than in 2005, and 40% to 60% more than in 2004.”
“The region’s sales laggards are: Milwaukee County, 5.2% behind last year with 1,230 sales; Ozaukee County, down 19.1% with 114 sales; Washington County, down 4% with 170 sales, and Walworth County, down 7% with 174 sales.”
Thanks to the readers who sent in the links this morning.
It’s about time we hear about different states being hit by the bubble. I was beginning to think that only CA,AZ,FL,D.C. were having the housing problem.
That’s what scares me : I really think the over building was nationwide .
No question about it Wizard….Just pick any state and goggle a major home builder and see how many tracts…Try Texas…
Marketwatch gets negative on the housing market.
maybe someone should tell this guy- already goin down dude
http://biz.yahoo.com/brn/060313/18280.html
This is what I’m beginning to wonder too. Even markets that are not overpriced can be over-built — low interest rates and speculaton can lead to both.
That said, I would be surprised if prices fell more than 10% in a market like Milwaukee, which is neither. Prices may just have to adjust downward a little to maintain affordability at higher interest rates.
And in fact an area which has a declining population can be over-built without any new construction taking place. Consider the likes of Buffalo or Scranton (or perhaps Detroit).
I was unsuccessful posting a link - but check out http://www.cbsmarketwatch.com. Paul Farrell and Irwin Kellner on housing prices and the bubble.
See the link I just posted below.
GS
My question is of topic, and it may have been previosly discussed,
but when the market turns and we see property values fall, if they fall by as much as say 40% what would happen to reverse mortgages?? I used to hear commercials and read articles advertising those like crazy, haven’t seen much about them lately though.
Lenders stuck
YUP…..
Yeah, I’d like to know that too - say a retired couple had their house valued at $400,000 in 2004 and have since borrowed $300,000 in various reverse mortgage loans and stuff and then in 2008 the house gets valued at $200,000 … is the bank going to just let them stay as long as they pay the interest?
Slightly OT,
But I had an argument with a Realtor about the bubble and affordable housing in DC and she tells me:
“Unaffordable” is not the best choice of words, as a home is an INVESTMENT. People purchased their homes years ago with the hopes that they would appreicate and they have. New Buyers have to keep in mind that their first home purchase may not be their dream home, but the first step in the investment process. To find affordable housing, you don’t always have to move further out. You can choose to change your lifestyle. If a person wants a home with a porch, and it costs to much in their neighborhood, maybe they should consider foregoing the porch or maybe even start with a smaller housing dwelling. Buyers have options. Also, what exactly do you consider a risky mortgage?”
Poor buyers that delt with this hoodwinker
Wow. Sounds like the sort of answer you might get at a White House press conference.
i just realized something very simple. if houses are “investments” than we should tell tose realtors: “oh ya? so they are bound by everything that comes with investments, right? speculation, over-under-valution… wide fluctuations in price. some people are winners, others are losers, it’s zero-sum game other than inflation right?”
but manyof those realtors are dumb anyway
Those dumb realtors and speculators will be flipping burgers in a few years instead of houses.
http://www.novabubble.blogspot.com
OT, but here is a Marketwatch commentator and Morgan Stanley alum who recognizes that CA real estate is about due for a 50% haircut:
http://tinyurl.com/p9wbb
It is only a question of when, not whether…
“Unaffordable” is not the best choice of words, as a home is an INVESTMENT.
No, a house -can- be an investment but only as long as it isn’t also your home. RE agents are in the business so they naturally think of houses as business items.
Right Robert….Your home as a investment is secondary…If you purchased your home, remained in it your entire life, would it matter what is was worth ??
No, it doesn’t. but it’s interesting to watch!
I think we get a 10% quick dwom, heck thats already happened, sfter that ?
OT: From the OC Register, JL’s blog
March 14, 2006
Slow sales can’t keep O.C. prices down
February’s O.C. home-price reversal comes with one caveat.
January’s $39,000 drop from December’s record high median sales price of $621,000 to $582,000 got many folks wondering if the market was ready to crater. But DataQuick’s fresh figures out early Tuesday seem to calm such fears — until you peek at the sales pace.
February’s bounce back to $617,000 — a price 11.3% above year-ago levels — shows that there’s a smaller but hearty group of shoppers willing to pay top price for O.C. housing.
February was the fourth straight month in which O.C. sales volume was down on a year-to-year basis. It was also the slowest February since 1997. So, when you add up the O.C. sales count from November through February, it’s the weakest four-month period since February-May 1997.
So how did prices jump on falling sales?
What helped prices higher was clearly the new homes category, which enjoyed its best February sales since 1989. Buyers flocked to condo projects: Irvine high-rises and old apartments converted for resale. Developers sold 491 residences last month, up 143% from a year ago, at a median price of $630,000.
A look at February’s housing numerology:
TYPE MEDIAN PRICE YEARLY CHG VOLUME YEARLY CHG
1-family $690,000 +14.8% 1,452 -19.6%
Condo $462,000 +14.1% 729 -17.4%
New $630,000 -21.4% 491 +143.1%
All residences $617,000 +11.2% 2,672 -7.5%
OT: From the OC Register a couple of days ago.
Million-buck tracts … in San Berdoo?
New homes. Million-bucks-plus. Common in The O.C. Not even a rarity in the resort slices of San Bernardino County.
http://tinyurl.com/j9l9u
Building $1M+ homes in the city of San Bernadino (connotates cheap, hot, smoggy, high crime, gangs, cow town, etc), then we are truly at the end. So if this is true, I would like to know the following 1) what are the sheeple buying this crap smoking, eating, and/or drinking? 2) where can I get the same so that I can go out to the desert south of Albuquerque and throw up a few 2×4’s and sell $1M New Mexico ranches for a cool $1.5 million. I am sure having clear air and a mountain view vistas would be worth an extra 500K over San Bernadino. Then I could retire rich and spend the rest of my life laughing at all of such sheeple.
By the way, would anyone really want to live in Milwaukee, with such amenities as freezing ass wind off of the lake bringing you bone chilling temperatures to your A$$, mosquitos by the hundreds in the summer, etc.
Summerfest is fun
Oh and if you like Harley Davidsons, it’s a great town! Also close enough to Chicago to benefit from its culture. I can think of worse places to live.
I lived there once. It smells like beer breweries. Fox Point & Bayside were nice, right on Lake Michigan. Just up Lakeside Drive from Chicago too (don’t know if that’s a good thing or not) If you’re not rich you probably won’t want to pay for taxes and heating costs up there though…
“We’ve got a shortage of Buyers”
hmmmmmmmm…
or you could say “We have an over supply of greedy sellers that are asking last year’s PIE IN THE SKY prices, unwilling to look in the mirror and realize they need to drop the price”.
Milwaukee isn’t terrible, but it is definitely overpriced, overtaxed. Local politicians and businesses suffer from a short-sighted rust-belt mentality. The weather can be terrible or beautiful. I’ve seen snow, sleet and beer fall out of the sky in a single day. (The beer was the result of a smokestack eruption)
mmmm….beer…(insert Homer Simpson voice here)
lol
The beer would have been the most fun. I have seen enough snow and sleet to last a lifetime.
Comment by an_dochasach
2006-03-14 12:48:46
Milwaukee isn’t terrible, but it is definitely overpriced, overtaxed. Local politicians and businesses suffer from a short-sighted rust-belt mentality. The weather can be terrible or beautiful. I’ve seen snow, sleet and beer fall out of the sky in a single day. (The beer was the result of a smokestack eruption)
I was going to ask what the attraction was to living in Milawaukee to justify its housing bubble, and you previous posters have all answered my question. It’s an alcoholics paradise!
I visited Milawaukee once as a teenager…I kept wondering what was up with all the factories and how come the place smelled like beer. XD