The Prices Have Definitely Softened
It’s Friday desk clearing time for this blogger. “After rising rapidly for several years, house prices have stalled in North Jersey, according to the National Association of Realtors. One buyer who has benefited from the recent turn of the real estate cycle is Burt Guralnik, who started looking for a house in Teaneck more than a year ago.”
“At that time, he and his wife found prices a bit steep. But in a slower real estate market this year, the couple recently snagged a three-bedroom Tudor, saving more than $100,000 off the seller’s first asking price in the mid-$600,000s. ‘The prices have definitely softened,’ said Guralnik.”
“The Triangle’s ailing new home market weakened further in the first quarter as tighter lending rules eliminated many buyers. ‘The people who come to our market used to come with confidence to sign a contract,’ said Chris Martin Pulte division VP of sales and marketing. Now ‘they’re just kicking the tires. The house next door has been on the market 14 months.’”
“The number of Bay State homes put up for foreclosure auction nearly quadrupled last month as tough market conditions left financially strapped homeowners unable to refinance or sell.”
“‘There’s just not much people (in financial jams) can do these days,’ said Tim Warren of market tracker The Warren Group, which yesterday reported banks advertised 1,712 foreclosure auctions in April. That’s a 355 percent increase from a year ago, as well as the largest number of auction ads Warren has seen since the early 1990s real estate bust.”
“Thousands of Virginians have lost their homes since the beginning of the year, according to the most recent foreclosure data. The commonwealth’s foreclosure rates rose dramatically during the first quarter of 2007.”
“‘I think some people have gotten into homes that they find now they can’t afford,’ said Steve Baugher, executive director of the Virginia Association of Mortgage Brokers in Richmond.”
“‘It’s just too ironic that this subprime crash is happening at the same time as these foreclosures,’ said Mike Burnette, spokesman for (a) nonprofit, fair housing group in Richmond.”
“Cypriots have gone on a massive borrowing spree encouraged by easy and flexible loan products from the commercial banks with the majority snapping up property, which in the process has fuelled prices ever higher.”
“The lending frenzy in March must have been a record considering that in March 2007 alone, total lending surged by CYP 594 mln compared to February 2007, while in the first three months of the year, total lending is up CYP 830 mln.”
“Compare that to the total Jan-Mar 2006 increase of CYP 342 mln and one realizes the dimension of the lending craze now dominating the country.”
“The Taupo district’s relatively slow population growth - about a third of the national average, has some people questioning the prudence of the ‘build it and they will come approach’ that has seen many large-scale housing developments planned for the district in recent years.”
“‘They’re (developers) hoping for another Queenstown but I don’t think Taupo has all the attractions Queenstown has, there’s just not enough employment opportunities,’ said Mapara Valley Preservation Society secretary Sarah Foreman. ‘Unless there’s a huge amount of people coming for some reason we don’t know about, I think it’s being very optimistic.’”
“Richard Fisher, president of the Federal Reserve Bank of Dallas, said Wednesday that the state’s employment growth might slow this year but would still be twice the national rate of expansion. He attributed that to an influx of Californians and Floridians, who are drawn by Texas’ lower cost of living.”
“He went on to say: ‘Our housing market is softening, but not as aggressively softening as in California and the rest of country, Arizona, Nevada, the upper Midwest and so on.’”
“‘We have a lot going for us,’ he said, ‘This is a very affordable place to live, and we’ve got the best Mexican food.’”
“The number of homes for sale in major markets ballooned in April, according to a new industry report, adding further evidence that the U.S. housing slump is still trying to find a bottom. In April, there were 743,367 existing house and condo properties listed for sale in the 18 major metro areas tracked by ZipRealty. That was up 33 percent from a year earlier and 7.2 percent higher than in March.”
“Some of the markets ZipRealty covers suffered far bigger inventory expansions than the total jump. Los Angeles reported a 39.7 percent leap since April of 2006, Miami climbed 53.9 percent and Seattle soared 63.2 percent.”
“More Seattle-area homeowners are facing foreclosures this month, according to new statistics.”
“‘We’re definitely seeing an increase in the number of people who are contacting us,’ said Erin Rearden, a mortgage default counselor. ‘We’re seeing people in much, much worse situations than we ever saw before — people in loans where the interest rate is 9, 10, 11 percent, the payments are more than their income, just scary loans.’”
“Many facing foreclosure already have refinanced at higher values, Rearden said. ‘People seem to be moving pretty quickly to take the equity out of their homes.’”
“The Portland-area median home price dropped in April, according to the Regional MLS. That was the first March-April drop since 2001.”
“The normal spring bounce in prices appears weak to nonexistent this year, said agent C. Morgan Davis. Last year, buyers would expect to pay more for a house each month, but this year, ‘The market wants more house for the same money,’ he said.”
“Home prices have grown far faster than nearly everyone’s incomes in recent years. ‘The people who would have normally bought their first house in 2007, they bought in 2005,’ said Bill Conerly, an economist in Lake Oswego. ‘So here it is in 2007. Can we get the people who would buy in 2009 to buy now? No. Because prices are too high.’”
“We asked visitors to the Lansner on Real Estate blog if any homeowners facing foreclosure should get government aid. And the results from 870 votes cast online in what’s an unscientific sample of public sentiment were stark: 9.2 percent: Yes. 90.8 percent: No.”
“Visitor comments: ‘Finally something all bears and bulls can agree on.’”
Another great week! My thanks to those who support this blog. Please check back this weekend for news, your market observations and topics.
Guess Fisher didn’t see this. And for that nice guy who is here from San Diego (the underwriter), note the Collin County numbers. That is a permanent sinkhole for anyone who dares to buy a house there, good economy or bad. Caveat emptor.
Foreclosure rate is up 14% so far this year
Pace of forced home sales is likely to stay high, listing service says
09:47 AM CDT on Friday, May 18, 2007
By STEVE BROWN / The Dallas Morning News
stevebrown@dallasnews.com
North Texas home foreclosure postings were up 14 percent for the first half of 2007 – an increase commensurate with a year ago.
For just June’s upcoming sale, about 3,700 houses in the Dallas-Fort Worth area are facing foreclosure, 16 percent more than a year ago.
Don’t expect a slowdown, said George Roddy, who heads research firm Foreclosure Listing Service.
“Just based on what we are seeing over the last two or three months, we are in for a long pull,” Mr. Roddy said Thursday. “There are still a lot of bad loans out there, and people having problems.”
Indeed, more than 21,000 homes have been posted for foreclosure during the first six months of the year.
Most of those loans are two or three years old, Mr. Roddy said. “Now they are trying to figure out how to pay.”
Many of the borrowers who are in a pinch have adjustable-rate loans that originally had lower payments. Rising property taxes and higher energy costs have also been a burden on homeowners, analysts say.
The biggest increase in June’s foreclosure numbers was in Collin County neighborhoods, where postings jumped 30 percent. By comparison, Dallas County foreclosure postings rose 10 percent during the same period.
It’s different this time
North Dallas 40closure
Thanks Txchick57,
First the Mexican food here in Dallas is not even close to being as good as back in CA.
I will say this about Collin County numbers - we are seeing the most price softening on the low end of the market - the mid-range $200K-$350K is holding up some what better and the above $350K is about the same as last year.
So yes the overall price is down…..
Don’t know about that. I’ve yet to find anything that rivals Pappasito’s fajitas here in SoCal.
Pappasitio’s chicken fajitas are awesome although my favorite is the “taco carbon with queso”. Mmmmm.
LOL
I do agree.
In Tex, they smother that nasty cheese over their mexican food, and they usually undercook the beans. They are not uncultured, though.
Guadalajara Market, on the corner of 10th & Empire here in San Jose. Excellent burritos.
Yep..another great week of price declines..at this rate it’ll be 2008/2009 pricing in no time….
OT..I noticed that there was a lot of bashing and unfair comparison of people in a certain profession this week. I think we should all take a step back and not be so quick to pass judgement. Not everyone in the occupation that has been the target of this denegration is all bad. So, therefore I say we stop comparing the real estate people to strippers. It is really unfair to the strippers out there, who work for their money and provide a valued service.
;)
LOL ! Great Friday PM laugh.
Well said!!!
And, unlike RE agents, strippers need talents. In fact, he larger the ‘talents’, the better…
Admittedly though, I do like watching both squirm!
Haha… good one Pen. For a moment I though you were going soft on the shills who are still spinning like mad.
This quote got my attention:
“‘We have a lot going for us,’ he said, ‘This is a very affordable place to live, and we’ve got the best Mexican food.’”
So much for the jobs, business opportunities, educational system, or anything else that’s major. We’re moving to Texas for the Mexican food.
Fisher’s a real “let them eat cake” sort. Very good at inserting foot into mouth.
You certainly won’t move here for the architecture, at least that done by the locals. This amuses me to no end:
http://www.guidelive.com/sharedcontent/dws/ent/stories/DN-museum_0518gl.ART.State.Edition1.4387296.html
“‘We have a lot going for us,’ he said, ‘This is a very affordable place to live, and we’ve got the best Mexican food.’”
That is even more the case for of Chiapas and Oaxaca states, but I am guessing the typical standard of living in those places is nothing to write home about.
Must share Mexican food story. Used to go to Yucatan a lot when husband and I lived in Fla. I couldn’t eat much of the local stuff, usually ended up in one of the several Lebanese joints in Merida. One day back near WPB, I went into a newly opened Mex restaurant, where I enjoyed the enchiladas. The owner was practically fresh off the boat/plane, no mucho ingles. I asked her how come her (authentic) Mex food was better than what I got in the Yuc. She said fresh ingredients and good refrigeration meant she didn’t have to kill everything with spices. Conclusion: Tex food could beat Oaxaca? In Chiapas I eat only at Rafael’s, which caters to gringos & Europeans, and promises lettuce is washed in iodine.
Yeah, what people call ‘X’ cuisine in America is really not what people usually eat in ‘X’- it is versions of it that will appeal to Americans taste. So, of course it will usually taste better to us than ‘X’ food. I used to have a Chinese girlfriend (in high school) who could cook wonderful ‘Chinese’ (i.e. gormet Chinese such as you would get in a restauraunt). One day she said “I think I’ll cook up what people really eat in Canton”- which was rice boiled until it becomes a mush, with random vegetables and some small pieces of fish added, a quantity of oil, an some white pepper and salt. It was good, but would get tiresome really fast if it was all you got day in and day out.
Of course, I really shouldn’t talk. Real Alaskan cuisine (i.e. Eskimo/Indian) involves such delicacies as seal oil, stinky heads (fish aged in the ground until it looks like bleu cheese), dried moose and beaver tail. Yum!
Make sure it isn’t made in a sealed plastic container: http://www2.cdc.gov/phtn/botulism/who/who.asp
Anyway, i think you are spot on about food. Authentic daily food is basically crap in most places. There are many regions of Mexico, and lazy people who do not use good ingredients…. home cooking is not always very good.
I, like most who love food, would choose Premium food over Authentic. Authentic is that millions of those in the USA eat hamburgers from McDonald’s/Burger King/Wendy’s - not Premium (fresh ingredents, better breads, etc)
I’ve eaten at many mexican food joints in CA,AZ,NY over the years and my general impression is unless you are starving at the moment one burrito is pretty much the same as another.
Disclaimer: do not order Mexican in Wisconsin !!!!
‘Disclaimer: do not order Mexican in Wisconsin !’
Nor Montana.
Don’t order it in Tampa Bay area, unless you go to this little hole in the wall taco shack that’s run by Americans and been in the SouthShore area forever. Also, I used to go to Carlos and Pepe’s on the 17th St. Causeway in Ft. Lauderdale. Don’t know if it is still there. It was practically an institution back in the day (’80s South Florida…sweeeeet!)
it is
Mo Money and Ben Jones :
I had a very good friend that ’swam the moat’ ( crossed the Rio Grande). He ended up in Racine, Wisconsin ~1980 and got a job as a short order cook at a Chinese restaurant. He married the owners daughter and opened his first restaurant (Chinese) very successful. The following year he opened a Mexican restaurant. This Mexican restaurant is superb. One of his spectacular dishes, Fajitas Combinacion, was a combination of Oriental seasonings as well as traditional Mexican seasonings.
There is another Mexican Restaurant that I go to when one of my business partners comes up from Mexico City. His words “you have no idea how good this food is, in Mexico City this restaurant would be packed”. The restaurants specialties Tostados de Ceviche ($1.75), Fish soup ($6.50) and Shrimp soup ($6.50). My friend has the Fish soup, I eat the Tostados de Ceviche and shrimp soup. In San Diego last year I went to a Mexican restaurant ordered the tostados de ceviche ($7.50) no better and half the size.
But for the most part - You are both correct. Taco Hell rules the midwest for Mexican food.
Taco Bell is all right for a certain value of “I’m hungry.” But Mexican it ain’t.
I was at the American restaraunt overseas…
I grew up in soCal, but spend the winter of ‘06 on the coast of Oregon - and found TWO restaurants in Newport, OR that had better Mex food than I had had in years. Go figure.
‘I think some people have gotten into homes that they find now they can’t afford’
WRONG!!
They could NEVER have afforded the homes in the first place.
Allow me to retort!
“They could NEVER have afforded the homes in the first place.”
This should maybe read,
“They KNEW they could NEVER have afforded the homes in the first place.”
I am not convinced that people went into this blindly. I bet, truth be told, most FBs would admit that they knew going into it that they were throwing themselves under a bus. Even not so sharp people, like all of ussometimes, hear that little voice that says, “are you sure you want to this?”, “is this really the right way to go?”, etc……
Whether we should to pay heed or not..well, that’s something different…
Maybe not thinking they were throwing themselves under a bus. Maybe wishful thinking about the likely future return from their “investment.” Maybe the kind of wishful thinking that we see on “Deal or No Deal” when someone turns down a hundred grand or more on a small probability of winning $1M.
maybe true, but even with wishful thinking, that little voice inside starts talking…
Do you think for minute that the Deal or No Deal players are hearing, “Take the 100Gs and run”? They know they shoud quit, but then greed and delusions of grandeur get in the way.
I don’t know. I’m a longtime lurker, because I bought in 2005 with 20% down on a 30-year fixed. Sure its a townhouse, but I should be able to make the payments for the next 30 years. The mortgage guy and realtor did all they could to convince me how stupid I was for not going ARM and getting into a single-family home.
Every time a soon-to-be FB mentioned that little voice to the mortgage banker and realtor, he or she was reassured that before the ARM reset, they could sell or refinance.
Ditto my fiancee. In 2002, on $40K income she set her target at $120K. The realtor and lender SOOOO tried to talk her into $180-200K. She would not budge. She KNEW BTTER!!!
Well, they finally talked her up to $130K.
“More Seattle-area homeowners are facing foreclosures this month, according to new statistics.”
But this can’t be! Seattle RE is different due to all those great tech jobs that will keep RE going up and up.
Maybe in Seattle they think the only thing that comes down is rain…
“We asked visitors to the Lansner on Real Estate blog if any homeowners facing foreclosure should get government aid. And the results from 870 votes cast online in what’s an unscientific sample of public sentiment were stark: 9.2 percent: Yes. 90.8 percent: No.”
“Visitor comments: ‘Finally something all bears and bulls can agree on.’”
Makes you wonder whether anyone in Congress is paying attention to blog polls…
Based on the recent Senate vote on amnesty for illegals, I’d say the answer’s a resounding “no”.
Unfortunately, you are correct, harm.
But the govt aide isn’t for the borrowers. It is for the lenders!!!!
“‘It’s just too ironic that this subprime crash is happening at the same time as these foreclosures,’ said Mike Burnette, spokesman for (a) nonprofit, fair housing group in Richmond.”
NTN the fair housing, affordable housing, etc. groups are beginning to get to me. Not that I think they are evil, I think they have the best intentions, but it seems that the same people that they are trying to help, they will most likely end up hurting (in most cases). Home ownership comes with bills, to pay bills, you need income. If you have a small income or credit issues or no savings, etc., home ownership will probably be the straw that breaks the camels back.
Financial education would probably go a lot further than shoe-horning people into a house.
Just my opinion/observation…
That was an unbelieveable statement. Does that fair housing guy not realize that the foreclosure spike and the subprime meltdown are just two phases of the same phenomenon of lending to unqualified people?
Hello?!
Nope..they don’t see it that way…
They think these people just need a foot in the door. It just doesn’t work that way. I am not blaming those that have economic challenges. I just don’t think it is as easy as assisting with a 3% downpayment or closing costs. They have to face it, that until someone has a critical mass of wealth or income, they can’t afford homeownership.
“They have to face it, that until someone has a critical mass of wealth or income, they can’t afford homeownership.”
I would soften that statement a bit. It is one thing to afford owning some home, but when strawberry pickers earning $20,000 a year are qualifying to buy homes that cost $500,000, there is a bit of a problem. It amazes me how the Fed managed to look the other way for so long on this, and how they are now claiming that the problems are contained, when they are obviously not contained. How long can they keep spewing this BS before even the dopes that write for the MSM call them on it?
ok, fair enough, but using your $20k example, someone making $20k probably can’t afford homeownership without some other source of assets…
thoughts?
It depends on where they live. There are cities in the midwest where homes in livable neighborhoods cost $60,000.
I find the idea that everyone in the country is entitled by birth right to own a home in the priciest coastal cities about as sensible as the notion that everyone should be able to purchase a Lexus or a European vacation.
Yep, renting out rooms and closets to 20 other strawberry pickers.
Then, of course, you have to pave over the front lawn for parking.
“… to 20 other strawberry pickers.”
The upside to your “one owner-occupant / 20 renter” scenario is that prices will rapidly become affordable in any neighborhood where this trend takes hold.
I have $20K/year people among my clientele. In AZ there are RV parks where for about $60K you could until QUITE recently get a lot with a “park model” (400 sq ft MH). Monthly assn fee $100. Community swimming pool, library, ballroom, jacuzzi, billiard room, laundromat, even showers if you decide to use the mini-shower stall in your MH as a storage compartment. People take great pride in owning these homes, as evidenced by the huge number of rules they try to pass to keep any messy neighbors from making it look like … a trailer park (!)
az_lender, I have relatives that you may even have lent money to! Heaven knows, I won’t, ever since a cousin screwed me on an investment that I financed for him in Ohio.
I had an uncle that lived in trailer parks most of his life, and they were pretty nice as trailer parks go. So I know what you mean about how they can become real communities where people raise children and in particular, retire. If you’re poor, that doesn’t mean you can’t have pride in your community and work to make it better. I also have a part-time employee who lives in a trailer park, which is also a nice little community. It’s a workable option for people with low incomes, and it can be both nice to live in and most of all affordable.
And you know what? It’s a lot more comfortable to live within you means and die in your own home than it is to be an overleveraged FB whose credit will be so bad that they won’t pass a background check for a rental.
Just wait until the next wave of homelessness numbers comes in. The wailing and screaming of credit-damaged ex-FBs that can’t even rent an apartment will be deafening.
“the largest number of auction ads Warren has seen since the early 1990s real estate bust”. Bust? Bust?!? Now you tell me! Gosh, I thought RE only goes up.
Northern Virginia Counties:
“Active” Foreclosures 05/16/2007
Arlington: 16
Fairfax: 235
Loudoun: 155
Prince William: 350
Frederick: 32
Fauquier: 14
Culpeper: 26
Stafford: 77
“Active” Foreclosures 04/20/2007
Arlington: 9
Fairfax: 139
Loudoun: 97
Prince William: 184
Frederick: 22
Fauquier: 10
Culpeper: 14
Stafford: 35
Wow, Prince William is getting hammered.
BTW: Where did you get these numbers?
Also, what about Alexandria? There should be lot’s of condos ripe for foreclosure.
Here in Ashland, OR, there are as of today 360 Houses/townhouses on the market.
Using April’s sales total of 30, that would mean 12 month’s supply…
That us a beautiful thing AshlandRenter!
May the California tsunami begin sucking back from whence it came. Have you noticed that the sellers are finally beginning to flinch now that the spring fling is fading?
The Dallas Fed deux’d lays down his “Tortilla Curtain” line of reasoning…
“‘We have a lot going for us,’ he said, ‘This is a very affordable place to live, and we’ve got the best Mexican food.’”
“‘It’s just too ironic that this subprime crash is happening at the same time as these foreclosures,’ said Mike Burnette, spokesman for (a) nonprofit, fair housing group in Richmond.”
Just a little pet peeve of mine, but there is nothing “ironic” about this. One definition of “ironic” is “characterized by often poignant difference or incongruity between what is expected and what actually is.” The foreclosures and subprime implosion were both expected (by anyone who objectively looked at the lax underwriting standards) and are happening; that they are happening at the same time is also no great surprise, since both the foreclosures and subprime implosion are the direct result of the lax underwriting and they are self-reinforcing.
At least all of the problems you mentioned are contained.
It is ironic that every time I spend a dollar, I have exactly one dollar less than I did before… I just don’t understand how it keeps working out that way!
Fortunately it doesn’t work that way for the country as a whole, as we have a gigantic printing press and helicopter delivery system…
When I spend $1, I have $10 more because the value of my house went up $11 in the time it took to spend that $1.
Like the Bill Gates thingy. He makes money so fast that in the time it takes to bend over and pick up $100 off the ground, he’s made $200.
Right, but the difference is that he will make the $200 anyway, so by picking up the hundred, for that action he would increase his income 50% for a moment it took. Same with the spend a dollar and your house goes up.
Re printing press. Republic of Iceland notes maturing 5/17/2013 are now priced to yield 8.95% to maturity in the local currency. The currency is up 10% against USD since about New Years. I don’t claim the currency play will get you anything more, but the bonds are rated AAA and 9% yield comes close to beating inflation and taxes.
Who Snagged whom?
“At that time, he and his wife found prices a bit steep. But in a slower real estate market this year, the couple recently snagged a three-bedroom Tudor, saving more than $100,000 off the seller’s first asking price in the mid-$600,000s. ‘The prices have definitely softened,’ said Guralnik.”
I’m not sure that I’d refer to the purchase of anything in the mid-600s to be a snag. Unless it’s the snag that hits my boat and causes it to sink.
Obviously Guralnik knows something about future inflation which you do not, which is that inflation in everything (including his future salary) will be so high that $600,000 will seem like peanuts in a few years.
Stucco, you’d better buy a bunch of houses in a hurry ! (?)
“One buyer who has benefited from the recent turn of the real estate cycle is Burt Guralnik… the couple recently snagged a three-bedroom Tudor, saving more than $100,000 off the seller’s first asking price in the mid-$600,000s.”
Burt? Burt? Hello in there??
He only paid over half a million for a 3-bedroom Tudor. He is a brilliant investor.
70’s-80’s numismatic slang about something selling for more than it’s worth…
“Moon Money” i.e.
Did you see what that guy paid for that coin?
He’s hopelessly buried, he paid “moon money”…
he benefited? well, let’s check back with Burt when the value of his house has dropped another $100,000 and see how he’s feeling about ’snagging’ his new house
One thing I would be worried about ,if I was Burt ,is that 100k is pretty huge amount for a house to come down in a year . If a property could go down 100k in one year ,what could it do in 5 years .Another thing I would worry about is was the 100k discount from inflated 2006 wishing prices or does it reflect a 2004 or 2003 price . This is where a property or neighborhood history profile of prices comes in handy .
“…was the 100k discount from inflated 2006 wishing prices or does it reflect a 2004 or 2003 price . This is where a property or neighborhood history profile of prices comes in handy .”
Exactly. One of my pet peeves is the term “price reduced” and how it is now employed as a marketing strategy. In my opinion, a reduction in price says little more than “greedy seller and realtor”. I am highly suspicious of any home touting such a status as it is oftentimes horribly overpriced even after the reduction. A home should be priced appropriately from the day it enters the market. If a reduction is made subsequent to that time, it doesn’t even need to be advertised. A drop from $600k to $500k on a $350k home is nothing to get excited about.
The flimsy properties of this variant of Rearden Steel…
“Many facing foreclosure already have refinanced at higher values, Rearden said. ‘People seem to be moving pretty quickly to take the equity out of their homes.’”
Still stuck on page 666 of Atlas Shrugged, by the way.
“Home prices have grown far faster than nearly everyone’s incomes in recent years. ‘The people who would have normally bought their first house in 2007, they bought in 2005,’ said Bill Conerly, an economist in Lake Oswego. ‘So here it is in 2007. Can we get the people who would buy in 2009 to buy now? No. Because prices are too high.’”
“We asked visitors to the Lansner on Real Estate blog if any homeowners facing foreclosure should get government aid. And the results from 870 votes cast online in what’s an unscientific sample of public sentiment were stark: 9.2 percent: Yes. 90.8 percent: No.”
I agree with the outcome.
I wonder who those 9.2% represent?
Bitter real estate agents who can’t make sales to bitter renters.
bailout poll:
“9.2 percent: Yes. 90.8 percent: No.”
———————————————–
that won’t stop posters making mountains out of molehills
ointment fly
wealthy non paranoid fly
How China perceives the US economy.
see US economy at crossroads
“…Finally, early this year, the real estate market began to influence employment. The unemployment figure reached 125,000. It is predicted that the unemployment rate will increase from 4.5$ to 5% in the fall.
Although the cooling of the housing industry has lowered prices, there is still an excess of supply on the market. Falling housing prices have also influenced consumption. When prices were high, developers were able to increase people’s purchasing power through their mortgage and property rights. Today this force is much weaker than it was a few years ago. The core retail volume (except for petrol and cars) has fallen to pre Iraq war levels.
Falling housing prices has decreased the value of property ownership rights. As a result, many mortgagers have delayed payment or breached their contracts. During the first quarter of this year, delayed mortgage payments were at a record high. While the mortgage quality is low, the loan quantity should be high. However, unpaid mortgages continue to grow at double-digit speed, with the total volume twice that of five years ago. Usually the rate of delaying payment and breaching of contracts is lower when loans increase. However, recently, new loans are also been defaulted on. This is the result of the large risk mortgages in the last two years. With the cooling down of the housing market, the demand for raw materials such as iron, steel and cement has also fallen. If the car sales also drop, the US economy will really slow down.
The US real estate market is gradually cooling down after macro-control policies were implemented. The US economy has entered its sixth consecutive year of growth. The possibility of a recession is increasing. The last period of expansion in the US lasted for 10 years. The public is expecting the Fed to decrease the interest rate. However, it is carefully observing inflation. With the overall weakening of the economy, inflation pressure is decreasing. If low inflation continues, there will be room for the Fed to decrease interest rates so the economy can make a soft landing.
As the world’s biggest economy, US economic trends are closely watched all over the world.
By Chen Baosen from the Chinese Academy of Social Sciences and translated by People’s Daily Online
http://tinyurl.com/2c29kf
Some interesting observations. “If the car sales also drop, the US economy will really slow down.” Already happening.
“Some interesting observations. “If the car sales also drop, the US economy will really slow down.” Already happening.”
No Shit. By this fall, you’re going to see some really bad numbers coming out of the auto industry. I mean really really bad. Bailout bad.
The only good news about this is that they (the auto makers) will finally be forced to break the unions, renege on the pensions, and declare bankruptcy, which they should have done 20 years ago. I say good news because this is necessary in order to unwind the atrocious mess that the U.S. automakers have made of their business.
Unfortunately, the side effects will be more than slightly unpleasant. But much like the former housing bubble, it’s something that we have to get over with in order to move forward.
The problem with the auto makers isn’t necessarily unions. If they had competent people in management, everyone would have been happy. Instead, they decided to build inferior products and push consumer credit on the crap they built. Then they started playing the mortgage game (GMAC.) The executives should have been strung up 20 years ago. A bunch of incompetent, corrupt dumba**es.
Exactly, H renter!
Debtor Nation: The Mortgage Mess airing on CNN Paula Zhan now.
Comparing RE agents and strippers is unfair. The strippers really do have to work hard for their money and reveal a lot of private things. They have to really do the work before they get paid. A bad stripper won’t get much in tips. RE agents just pimp their wares, good or bad.
My wife was once part of a family that treated her really bad. I referred to them as the ‘pig’ people. Then I thought, that isn’t fair. I shouldn’t insult pigs like that.
Same for the RE, MB, and other slime that blew this thing out of proportion.
Is Irvine like Santa Barbara? RE agents think prices will not drop here. I continually see the same properties in Woodbridge that have been on the market for over a year and all they do is move the signs.
I didn’t like Cuomo when he was elected, but I LOVE him going after crooked appraisers!
http://tinyurl.com/2eh2dc
I like Texas, but I don’t think I’ve ever had good Mexican food there. I question Richard Fisher’s judgment
Know what you mean. Great BBQ in TX, some good Tex-Mex, but frankly Las Vegas does better Tex-Mex than Texas, and the Ortega family here in Cali ran the best straight Mex restaurants. Of course the best Mex food is seafood straight off the boat, but it’s hard to find that (clean) even in Mexico. Best shrimp I ever had I bought from a shrimp boat 5 miles off Bahio Kino. Actually traded them some Mahi-mahi I had just caught for the shrimp. And fresh Mahi-mahi is indescribable. Too bad the Mexican restaurants in Mexico are so filthy, because they could be great if they were safe to eat at, since they have direct access to fresh seafood.
The worst allegedly Mexican food I have ever had was in Illinois. So Texas has someone to look down on.
The worst allegedly Mexican food I have ever had was in Illinois.
I ate something from a Taco Bell in a Sydney, Australia suburb named Gladesville, and I’ll bet it was even worse than IL. The refried beans in the burrito I ordered looked (and tasted) very strange….
I don’t understand why anyone would go to a Taco Bell in Australia.
It isn’t even cheap.
So, this morning I challenge AZ Republic’s journalistic integrity.
http://www.azcentral.com/blogs/index.php?blog=164&title=metro_phoenix_home_price_drop_beats_nati&more=1&c=1&tb=1&pb=1#comments
This afternoon:
http://www.azcentral.com/community/gilbert/articles/0518gr-summerhomes0518-ON.html
“Hennecke bought her home in the Higley section of Gilbert with her husband in November, and said she benefited from an $85,000 price reduction.”
“The Valley’s real estate market has 20-25 percent more inventory than it needs”
“If sellers need to lower their asking price, they should limit it to one significant cut, Butler said.
“I tend to favor the big move a little bit,” he said. “If you do a lot of little increments, their question is when do you actually stop? There’s no incentive for them to make a move on it.”
Last year’s market was bad, said Michelle Krause, a real estate agent with Century 21 Desert Palm in Gilbert. But, sellers are lowering prices and the tide is starting to turn.
“It really is starting to pick up this year,” she said.”
Translation: If you want to sell your house lower the price A LOT!!!!
AND this story was added this afternoon
http://www.azcentral.com/business/articles/0518biz-biztalker0519.html
“No quick rebound in housing prices”
“One barometer Higgins follows is the ratio of median housing prices to median household income. Nationally, the figure is 4.9 times greater, and it’s a bit higher in the Valley, at 5.9. That implies more cooling off ahead so that incomes can catch up a bit to home prices.
But that’s nothing compared to the gap in certain areas of California including San Diego, where the ratio is 14 times, Los Angeles/Orange County (13.4) and Silicon Valley (11.4).”
Doesn’t mention that historic norm is 3, meaning we’re 2x over priced.
I’m sure these two negative stories, after months of nothing but postive spin, are PURE conicidence to my calling them on it.
Tap, tap, tap. Is this mike on? It looks like the server blew up again.
Posting is broken again, I give up. See you all on the weekend.