Local Market Observations!
What do you see in your local housing market this weekend? Lower prices? “The housing slump hit Mecklenburg County hard last year, with building permits for new homes down 29 percent to the lowest level in at least 10 years. Builders saddled with unsold homes are cutting prices. ‘We think the market has definitively softened up tremendously in Charlotte,’ said Rick Bell, CEO of Turnberry Homes.”
“The high-end Nashville builder has stopped building in the Charlotte area and cut prices on its remaining houses. ‘Our misfortune should be someone else’s fortune,’ Bell said. ‘They can get a very good home for a fraction of what it cost last year.’”
Cancelled projects? “Portman Holdings, citing an uncertain economy, is postponing development of One Charlotte, a high-end, 40-story condo tower planned uptown next to the Westin Charlotte. The Atlanta developer had planned to start construction this summer of the project, which includes 99 ‘urban estate homes’ priced from $1.5 million to $10 million.”
“Charlotte multi-family housing analyst Emma Littlejohn said One Charlotte’s $1-million-plus target buyers, like people in the broader residential market, are having difficulty selling homes and can’t easily move up to a luxury condo.”
“‘Their values have eroded and they, therefore, are not buying at the top of the market,’ she said.”
Or foreclosures? “A large number of foreclosed homes is pushing down home sale prices locally, Realtors said. ‘The market is flooded,’ said Kathy Carroll, president of the Youngstown-Columbiana Association of Realtors. ‘We have an overabundance of houses.’”
“About 20 percent of the home sales in the area are foreclosed homes, said Dan Crouse, past president of the Warren Area Board of Realtors. ‘Banks are offering them at an incredible price. They want these homes off their books,’ he said.”
Advice about renting? “Homeowners across East Anglia have seen thousands of pounds shaved off the value of their homes in the last few weeks, according to a report released today.”
“‘I think prices are falling and I think we are probably at the stage where we do not quite know where prices are going,’ said Carl Eastwood, a partner at Bidwells estate agents in Norwich. ‘With the stock we have from last year, the ones that are selling are the ones where people are reducing the price. If prices have not been reduced, they are not shifting at all.’”
“‘My advice if you are selling is to listen to your agent. You might have to accept that your house is worth less than it was last summer,’ he said. ‘If you are a prospective first-time buyer in rented accommodation, sit tight. Prices are not going to go up, you are best to bide your time.’”
Industry boosterism? “For those who believe that housing is going to stage a turnaround, the next month may be a last chance to get a home at a bargain price. That’s because, if the early spring selling season gets off to a strong start, incentives and discounts may soon be a thing of the past.”
“‘There are signs that consumers are growing a bit more confident and that there is some pent-up demand for new homes,’ said Jack Sorenson, president of U.S. Shelter, based in Hoffman Estates.”
“Some builders said they are redesigning townhouses, to make them more affordable. Multifamily housing is comprising a larger portion of the local market. ‘We won’t see any further lowering of prices,’ said Chris Naatz, VP of sales and marketing for Pulte Homes/Dell Webb in Schaumburg.”
“As for land prices, ‘in some cases, land is worth 40 percent less than it was a few years ago, and builders are eager to clear if off their books,’ said Andy Konovodoff, president of the Illinois division of Town & Country Homes in Lombard.”
A related slowdown? “A national slump in housing starts and the shaky health of the home mortgage industry are key factors in RY Timber’s decision Monday to temporarily shut down its mills in Townsend and Livingston. Each mill employs 100 workers, and each has an annual payroll of approximately $2.5 million, said Scott Stern, Montana operations general manager for RY.”
“Stern, who has worked in the lumber industry since 1971, said that the wood products industry had major layoffs in 1980 and 1981. ‘It was a market-driven housing thing,’ he said. ‘The market was every bit as bad then as it is now.’”
Any banks laying off in Charlotte? That’s not good for home sales.
I just returned home from a trip to Australia. I was all over the west coast. It appears that the bubble is at the end of its rope there. But let me tell you some local observations:
1. Boxing day- the day after christmas we went downtown sydney to see the crowds. It was to much to handle.. not sure if it was the booze the night before or the endless amount of Asians fighting for everything for sale. I felt like I was in another country. Never have I seen that many people and security moving them in and out.
2. Ran accross a builder in Some part of england at the bar.. many koolaid type of comments about the part of england he lives in.. but the main thing was it was different and they are not making any more land.. he asked me what I thought and I told him that tells me your in trouble.. did not take it kindly.
3. The south outside Melborne has some great deals with ocean views and plenty of land..
4. You can get good lots 1arce in Perth for under 50k.. very nice weather simular to san diego temps..
5. Sydney has forsale signs everywhere.. simular prices as san diego if not more.. but you get a 11% discount (today) as a result of our strong dollar:)
6. Put this on your travel list but plan to spend money as it is not cheap.. average beer 6.50 bucks OZ
Eat our dust Aussie! New Zealand is the most unaffordable country in the whole bloody world!
“NZ houses world’s least affordable”
http://www.nzherald.co.nz/section/1/story.cfm?c_id=1&objectid=10487926
Ok, I will admit that some places in California are even worse. But we are talking about an entire nation. If Californians can’t stand the unaffordable property prices they can rent a Uhaul and move to cheap housing markets in Indiana or Ohio. ALL NZ markets are severely unaffordable, even the smallest towns and worst crime infested neighbourhoods. Kiwis wanting affordable housing have no option except emigration overseas. And they are leaving in record numbers.
“‘For those who believe that housing is going to stage a turnaround, the next month may be a last chance to get a home at a bargain price. That’s because, if the early spring selling season gets off to a strong start, incentives and discounts may soon be a thing of the past.
“‘There are signs that consumers are growing a bit more confident and that there is some pent-up demand for new homes,’ said Jack Sorenson, president of U.S. Shelter, based in Hoffman Estates.”
Will they never stop this nonsense? My favorite, “Only One Left!” stopped working about two years ago.
I also like won’t last long at this price.
Also lowest 3/2 in town and there’s a 100 priced way lower per square foot and they’re almost identical houses in identical neighborhoods.
The sense of urgency is long gone and there is no way to bring it back. Have they not figured this out?
My all time favorite is all those adds on craigslist that say “X000k below market value.” I still can’t figure out why they like me so much, and why they wont sell sell to the person offering them six figures more. I am pretty freaking special, but give me a break.
“‘There are signs that consumers are growing a bit more confident and that there is some pent-up demand for new homes,’ said Jack Sorenson, president of U.S. Shelter, based in Hoffman Estates.”
At this point my response is “Great, a new housing boom will push rents back down and I can get back to getting free months when signing a lease. And I can set up my investments to take advantage of the boom and subsequent bust. I’ll make even more money off of it than I did this time. What’s that, you wanted me to buy your house? No thanks.”
Here in Orange County, CA, some real estate agents are getting smart (no, really…) the OC Register Business section profiled some that are no longer acting as real estate agents, they are now pitching the OC assesor’s office with a home’s estimated lower value, in an effort to reduce the taxes. As payment they are taking half of the tax savings. so, if they save you $1000 off of your taxes, you pay $500 to them.
I don’t know about OC, but here in Ohio if they’re doing it it’s illegal to get paid for that if you’re doing it as a realtor. They could lose their license, such as it is.
‘I don’t know about OC, but here in Ohio if they’re doing it it’s illegal to get paid for that if you’re doing it as a realtor. They could lose their license, such as it is.’
Ethics left the barn a while ago.
The local paper is full of FBs, and they are trying just about every pitch imaginable. One sold trend; builders running ordinary classified ads for individual houses. Of course, they are undercutting recent sales.
Also, a big new townhome development just hit the market. Look out below!
One of my favorite FB craiglist’s recent postings is from Myrtle Beach, SC.
This guy appears to know what he is up against with the competition and says it.
Perhaps IF he KNEW about lowering his Price..it WOULD sell
http://myrtlebeach.craigslist.org/rfs/541664920.html
In Chicago, I’m still seeing very active construction projects (in residential and commercial) despite one of our glorious cold snaps (it’s -1 F right now) — presumably developers are trying to get all their inventory online for the Big Spring Selling Season.
I walked by a fancy high rise joint on my lunch hour yesterday at 110 West Superior, which is just north of the Loop and pretty close to the lake. It looks either pretty close to done or perhaps habitable on some floors. Prices are listed at $530K to $1.6 million. (Hah.)
110 West Superior
This particular real estate company, @Properties, has an incredible number of fairly ambitious projects still in the pipeline at all different price points. They have a smallish gut rehab going on across the boulevard from me, in fact (here). That particular project was stalled for months, then suddenly kicked into overdrive all at once. It’s mostly done now, with a few FB Pioneers inhabiting early.
What’s a price point??
I hear that a lot. Do you mean Price?
price points are based on what the market says people are spending.
Eg. $15,000 econobox car, $25,000 mid-range, $35,000 deluxe, $45,000 luxury. . .
Yeah, essentially.
I think a “price point” just means a price that’s attractive to your demographic — e.g., at the correct price point for a particular neighborhood, demand should be maximized.
What a developer thinks is the correct price point, what the market-at-large thinks is the correct price point, and what we here at HBB think is the correct price point — those are likely three different things.
All of retail is based on the idea of price points.
Primer: For example, “Under $10″ is a price point, but $11-12 is not. $99 is a price point but $130 is not. Under $10 qualifies as an impulse item that is cheap enough not to need to be counted in a budget. Retailers like to sell for $8.99 or $9.99, but not $11.99. The idea of price points is THE crucial question for wholesalers and jobbers determining margins and viability of products - does the product fit into a good/its proper price point that makes it an attractive offering and still provide the necessary margins for everyone to profit?
I think all of you need to work for the department of redundancy department.
My point was there is not such thing as a “PRICE POINT”.
It is American Business-ease. A fake language made to sound important but meaning nothing.
What is the PRICE?? What is the Price-point??
It’s like the business letter: “please be advised that………??”
Why not just tell me what you are trying to tell me.
In every statement made, delete the word “point” and you have and understandable and perfectly good sentence structure.
I’m just bored today.
When you don’t actually set your own prices, you have to buy and sell based on the understanding of how others set prices. I don’t need to know the exact price the retailer will charge, but I have to know how my product fits into his pricing structure. If my product doesn’t fit into his pricing structure with proper margins, he will either undercharge or overcharge based on fitting it into the pricing structure, and the product will not move properly. As prices get higher, “dead pricing areas” become broader.
Once again, price resistance is not a linear function. The resistance of $10.99 relative to $9.99 is much greater than the resistance of $9.99 to $8.99. If people simply price based on margins and don’t pay attention to retail pricing dead areas (which leads to the idea of price points) they will quickly find that certain products don’t work because they fail to find their proper price points.
If you like, change “price points” to “price ranges.” But inside those ranges, there are certain psychologically-superior target prices, and those are quite naturally called price points.
I agree.
I cringe at: “at this point in time”… Different than something like “at this point in key-lime cheesecake”?
New Jersey beachfront condos that were listed in the low 700’s at the end of 06 are still sitting but now listed at low 500’s. IMO rents won’t even support a low 200’s price.
Wasn’t there a realtor quoted yesterday that said those properties are still selling like hotcakes and beachfront never goes down because it’s so special?
Ever go into a restaurant only to be disappointed, because they sold out of hotcakes?
It’s never happened to me.
One time I went to a Kentucky Fried Chicken and they said, “Sorry, we’re out of chicken.”
That was kind of disappointing.
Here in the central valley of California we were looking at a new custom construction that was listed for $535,000. Nice house and decent area but nowhere near worth that amount. It got reduced to $498,000 and I figured I’d watch it till it got down to the $300’s. Well some FB went and bought it at the $498k this month. I remember buying my first home in 1991 and I had no idea what was going on in the market at that time. I even paid the full price the builder was asking. No wonder he was so happy to provide all the little extras like an additional wall outlet here and there and run some sprinkler wires to the back of the house. My point is so many are unaware of market conditions and can be convinced of what a fantastic “deal” something is. I can’t imagine who would have bought that house at $498k? Definitely someone with too much money and too little brains.
A friend of a friend from Bakersfield, CA just bought a second home in Cambria, CA. He got it $100K below peak prices so they figure they have $100K in equity. Just heard that they had to pay a $100K for roof and minor repairs going in. Of course they are not making any more land in Cambria, housing prices on the coast don’t go down, prices in the future will only go up, and when the divorce comes the wife will have her beach house. Only problem, all her friends will still be in Bakersfield. Mindsets are hard to break. BTW: house cost $600K+.
Northwest FL,
Realtors here are flooding craigslist with their MLS listings. I looked up a few of the addresses on the property appraiser web-site. Some of the properties were purchased by the listing realtors at 2005 and 2006 prices. They still have their wishing-price set higher than their purchase price.
Thank goodness the guvment is going to save the economy by mailing “free” money to everybody.
This is something I have commented on in the past.
I am very annoyed by Realtors using Craigslist to market their MLS over-priced crap.
Craigslist has been a source for private sellers for most of it’s existence and usually is a good source for finding deals with individual sellers.
BROKERS are all over it now. It takes me a long time to sort out all their crap and find real homeowners that want to sell a house.
I think the only way to cure this is to start responding to the ads and agree to meet them at the house at a certain time with fake name and payphone number.
Then don’t show. If enough of us do it, perhaps it will get those parasites off of craigslist.
My point here is that they are wasting our time with their over-priced listings………..lots of them, and making it difficult to find a house that is for sale.
we should be able to waste their time, too.
Craigslist should have two listings there one for by owner and another by dealer like the auto and furniture has.
Rentals are already divided this way, at least on the NY CL.
That’s a really good idea. Just one problem.
Most of the listings now are “broker-owners”.
You know a lot of Realtors bought their own stories about what a great “investment” real estate is.
Can we double-flag them if they list their own stuff?>?
Perhaps if enough people request craigslist to create a separate real estate by owner category, they will do it. Craigslist now has a separate category for cars for sale by owner.
Hopefully, the realtors cross-posting their MLS listings to the “by owner” category will be flagged off by the community. Worth a try anyway.
Suggest that CL charge them 6% if the property sells
Yeah that $500-800 per person won’t even cover most people’s mortgage payment for a month.
Does seem to be an explosion of houses listed on Craigslist for NWF vs. a couple months back.
Consensus needed here at HBB
Is it “gubmint, gubbermint or goobermint?”
We should be on the same page.
I vote dor goomit
I do believe its gubmint.
Lane
gub’mint.
gub’mit
I’m in Phoenix for a brief weekend. Found a brochure on my door for one bedroom condos in Scottsdale (Monterra? Near McDonald and Granite Reef) at $20,000 off the price for $139,000. I didn’t check these out. Location is about right for me, but I suspect these are conversions - without garages. I think the price is about $40,000 too high for this deteriorating market. The line on the brochure said they need to sell 10 units - their loss, your gain! LOL.
I’d be interested in a 1200 square foot 2 bedroom condo with a garage in the area when the bottom falls out. I miss the Scottsdale greenbelt, as my current Phoenix apartment is in Ahwatukee.
“Some builders said they are redesigning townhouses, to make them more affordable. Multifamily housing is comprising a larger portion of the local market. ‘We won’t see any further lowering of prices,’ said Chris Naatz, VP of sales and marketing for Pulte Homes/Dell Webb in Schaumburg.”
This is great. Now we know where the bottom is, because, well, didn’t you know? Pulte sets market pricing. They will be sitting on more homes than they’ll know what to do with. Oops, too late!
I posted about a competing development from Kimball in Hoffman Estates two weeks ago, very close to the Pulte development. Here are some of the stats again. Note: these drops are nothing compared to CA & FL, but for Chicagoland, this is dramatic stuff. Pulte, Kimball and Ryland & others are competing in this immediate area. You betcha they have more pain to come.
1680 White Oak
sold by Kimball 6/06 for $570,500
not sure of OLP or DOM, but house reduced to $514,900 before selling for $475,000 in 8/07
1302 Caribou (same subdivision)
sold by Kimball for $456,500 in 1/03
on the market over 350 days in 2006/2007
LP $548,500, reduced to $529,900 before selling for
$480,000 in 12/07
5767 Red Oak (bank owned, still for sale)
sold by Kimball 5/05 for $591,500
OLP - $575K, reduced twice, now asking $489,900
For my entire original post, scroll down to last post on the thread:
http://thehousingbubbleblog.com/?p=3976#comments
‘We won’t see any further lowering of prices,’ said Chris Naatz, VP of sales and marketing for Pulte Homes/Dell Webb in Schaumburg.”
Whatever this guy is smoking, I want some!!!
Mexican standoff between buyers, sellers, and lenders in N San Jose still.
*TWO* out of 15 listings have sold since August. 10 out of the 15 have been withdrawn. Prices descending softly, non-conforming requires 10% down, which is a lot to scratch together, plus I suspect the FOB “Chindians” are all subprime due to short credit histories, and that market is dead dead dead.
We’ve got it all in my neighborhood in the Tampa Bay area. Floppers, crashing prices, people taking down For Sale signs then putting them back up, foreclosures and nothing is selling at any price. Because nothing is selling, I can’t say how far prices have fallen since 2005. But a lot.
We have two foreclosures on my street including the house next door. We’ve been wondering why the real estate agent hasn’t held any open houses. Well, guess what. It turns out my neighbor is a hoarder, obsessed with buying old radios. To see the house you have to follow paths between boxes of radios and other junk! Oh boy.
He’s not a hoarder, he’s a collector.
A story about market conditions in Bozeman Montana. At hearing in Bozeman municipal court, Friday, before Judge Seal. A person who is a 21 Century agent was appearing. Judge Seal asked him “what are you going to do about all these fines? The realtor said ” I don’t know, I haven’t been able to sell anything in months.”
I think this realtor is going to end up doing community service (at $10.00 an hour) to pay off all of his traffic fines.
Is this justice or what.
You know, it was nice the one and only time I got a ticket (because my lights weren’t all the way on, d’oh!) that the fine ($150+, they believe in slapping hard for little things here) and the traffic school ($130, and you could do it online) were annoyances, not major crises.
Yes, I could have gladly spent the money elsewhere. But having to pay the fines did not mean a lack of groceries that week (or month.) Just severe grumbling and mental slaps to the head. (I have very good night vision AND was driving down a well-lit road, so I literally didn’t notice!)
Yeah,I’ve seen that a lot; turn my ights off and on but it never seems to click with the other drivers. Also, driving without lights is a huge signal to cops that the driver might be drunk. Not suggesting you were.
I’m sure there are lot of people all around towns in the Rocky Mountains in winter who would be happy to sacrifice their time for $10 an hour, good times or not, especially doing non-work like government community service.
$1/hour or the slammer would be justice. Showing up at court without money to pay fines is like overstaying a visa in a foreign country. You should have thought about it earlier; you don’t deserve mercy; it’s not fair to the law-abiding population.
Some conventional wisdom from today’s real estate section Washington Post - “Renters on Top”
In the past year, the apartment supply has grown, thanks to an infusion of nearly 10,000 new rental units, a quarter of which were originally slated as condos, and an increasing number of homeowners and investors who have opted to become landlords after failing to sell their homes or get the desired price in the down market, according to a report by Delta Associates of Alexandria, a research company that follows apartment and condo trends.
http://www.washingtonpost.com/wp-dyn/content/article/2008/01/18/AR2008011801829.html
Here in Hampton Roads (Norfolk, Virginia Beach, Newport News and surrounding cities)… 75 foreclosure notices in VaBeach, 47 in Norfolk, and a good number of them elsewhere. That number seems to be ticking up. The big Granby Tower condo project, which was our 2nd really large one… Liens are filed against the builder and all of the equipment has been removed. I’m told houses are still selling, especially with the military. They will come to town and buy whatever, then wonder why they can’t sell it in 2 years when they get new orders.
Meanwhile, I survived layoffs Wednesday. Went from ~30 to ~22 or so. Friends at NASA told me their contractor cut 9 positions on Wednesday too. There are definitely still jobs with the gov’t contractors though.
There is still a number of large apartment buildings scheduled to go up next year. Also, there are lots of vacancies as far as I can tell. At least two of my coworkers that got laid off are looking at Raleigh and DC. Honestly, the Hampton Roads area is kind of bleak when it comes to really fun or challenging jobs. I have friends that work for contractors and they know that the local office is a much less fun work environment versus the offices in Seattle or Portland or Boston and such. I suspect (but can’t prove) that people are leaving the area now that the prices are so high and salaries are only mediocre. The low cost of living (and perhaps water) were the only two things going for the area.
There are definitely still jobs with the gov’t contractors though ??
We need Bloomberg or Ron Paul (Or Both) to take care of this kind of crap….I am just worn out with this….We need to start over….
They are still building some $600,000 non-waterfront houses along Ocean View Av in Norfolk. However construction is going slow, instead of a dozen people working on them, now you see only a couple of guys. However there are still a lot of new houses, two years old and never occupied still sitting empty. Some have their for sale signs taken down, but when you looked in there was no furniture inside and no cars in the driveway.
Ocean View Ave. - that funky neighborhood where you went to hang out and have a drink on one of the outdoor patios while you waited for traffic to clear on the tunnel on I-64? That was a pretty funky place, very self-contained, teachers and construction workers and semi-retired Navy guys - I always imagined those clapbox duplexes and spindly apartment houses going for a couple hundred dollars a bedroom. I can see how it might have become a little trendy, but $600,000 non-waterfront houses along Ocean View Av????
“That was a pretty funky place, very self-contained, teachers and construction workers and semi-retired Navy guys –“
That was around 15 or more years ago, then the city bulldozed a bunch of housing projects and a lot of the residents moved to Ocean View. Crime went up, the city did nothing until it declared the area “blighted”, then it bulldozed large sections and had developers start building the $600,000 homes. Now we have some of the old housing still owned by those blue collar types and retires right next to McMansions and right next to mini projects.
During the summer there was a murder where a gang of people including 3 teenage girls beat to death one guy. The developers were panicking since they were saying they could not sell their McMansions when only a street or so back from the main road people were being beaten to death by gangs. Of course being PC they and the homeowners did not protest against the actual gangs or individual criminals, they blamed the apartments and hinted that they should be torn down. Though in fact the apartments were not the ones who committed the murders or the other crimes in the area, they are after all just buildings. The problem is the people living in the apartments but you can’t say that these days.
Wait a minute, I thought that Granby Tower was getting filled up by trendy 20-something urban career gals with their oh-so-perfect $35K a year financial services filing-and-answering jobs who were busy building their nest eggs while they waited for Mr. Right.
Mr. Right wouldn’t survive the gang-bangers looking for someone to rob or carjack in that area.
Two observations:
1. was in Vail for a week, very quiet, restaurants nearly empty — lots of space on the mountain.
2. Home sales numbers in Phila are back to 2002 levels. Prices still high but no data on price per square footage. Realtors still telling me that it’s different here. http://tiny.cc/vWzQp
I love Vail. Got married there, in fact. Beautiful place.
Given this has been a fantastic year for them as far as snowfall goes, well… so much for the foreign tourists taking advantage of cheap dollars and bailing out the economy. One might forecast that this doesn’t bode well for Disney’s park revenues this spring.
Lots of radio ads in the LA area promoting skiing in Big bear and Mammoth. I don’t recollect such ads in previous winters.
Oh they were there in spades, but for the most part they were the only ones there.
Snowfall this year is unreal. I’m surprised to hear that Vail isn’t too crowded. Maybe the wife and I will head up there in February.
Avalanche conditions are severe all over the state this year. We’ve had too many tragedies already this year.
General observations’ from LA’s Westside. I am beginning to hear realtors complain that “buyers just don’t get that prices have already come down and will not come down any further”. It’s all the buyers’ fault, you see. I am also seeing many nice “for lease” properties in prime areas sitting empty. Asking prices for rentals are high, but still a fraction of what it would cost to own the houses at the theoretical semi-deflated bubble price. Panic has not set in yet, but there is a lot of unease. I guess it’s because virtually every home in my area (wealthy, but not the kind of people who have $1M cash in a bank account) would require a jumbo loan and the reality of the credit crunch is sinking in. I mentioned earlier this week that a nice house for lease two blocks from us has been sitting on the market for 6 months with an asking price of $4,900. When it became vacant 2 years ago, I called about it and they told me the lease was $5,500. It was subsequently occupied until last summer, although I don’t know what rent the tenants were actually paying. Does this indicate the deflation in rent costs that some people have discussed in this blog?
Also, and this is almost scary, our financial advisor has suddenly turned bearish. Let me tell you that not long ago it was like pulling teeth to get him to understand that I wanted to get rid of our stocks.
We were able to negotiate $550 off monthly asking price on a lease. DH is going to see the place next week. The place is only a couple years old. Buys me time to do my DD to make sure the place is not in lis pendens or foreclosure.
cass:
Interesting about your financial advisor, turning Chicken Little on you…
Why the sudden flip-flop?
I think he either knows something that we don’t know yet or he sees that all of a sudden most of his clients are beginning to sound like that nutty Cassiopeia…We’ll see.
When you are smarter than your financial advisor, I’d suggest it’s time to fire the advisor. Unless it’s just a stockbroker or insurance agent, of course
“Also, and this is almost scary, our financial advisor has suddenly turned bearish. Let me tell you that not long ago it was like pulling teeth to get him to understand that I wanted to get rid of our stocks.”
This is great news, IMHO.
Or foreclosures? “A large number of foreclosed homes is pushing down home sale prices locally, Realtors said. ‘The market is flooded,’ said Kathy Carroll, president of the Youngstown-Columbiana Association of Realtors. ‘We have an overabundance of houses.’”
“About 20 percent of the home sales in the area are foreclosed homes, said Dan Crouse, past president of the Warren Area Board of Realtors. ‘Banks are offering them at an incredible price. They want these homes off their books,’ he said.”
These realtors are telling it like it is. They’re from my area and the number of foreclosures is astronomical. Most of Trumbull Cty, Northern Mahoning and Southern Columbiana Ctys are the hardest hit with foreclosures. A lot of those areas have always been poorer and in some areas prices have been stagnant for years. Other parts of the 3 counties had prices rise, although not like FL, CA, NV, AZ or MI. The economy hasn’t boomed here in 20 years. It died off after the steel mills closed. GM in Lordstown OH is the one area that’s kept things going.
Talked to my mom in Brentwood, TN yesterday. A realtor friend told her that in May everything (sales) just stopped. Dead in the water. He said it was just shocking and eerie. He was used to “soft landings” and the market “gradually slowing”, but this is just strange.
He is telling people to not even bother putting their homes on the market unless they absolutely must.
My sister lives in East Brentwood, was there over Christmas. Noticed on traditional bike ride with my niece that there were a lot more houses than previous year, but of course I am used to seeing lots of new houses everywhere all the time.
What I did notice is how large all the new construction houses were - mostly brick and on steep grades and was thinking how much higher cost of construction is relative to Florida.
I also noticed that the quality of construction (siding, roofing, trim) at another sister’s newish apartment complex in West Nashville was some of if not the worst I had ever seen. (Nashville has an unusually high percentage of Mexicans doing construction, and they are notoriously sloppy at trim work. Sorry to generalize, but I’ve been around enough to know that most Mexicans simply don’t appreciate that, say, roofing serves an aesthetic as well as a waterproofing function.)
My sis is about 2-3 years behind the times - I think she has just now heard about GPS - so it is no wonder that she thinks prices have gone up/are going up a lot. During the 2003-2005 period she was clueless (and in fact skeptical) that house prices were rapidly appreciating in many places (such as Florida, Virginia)outside of the Nashville area.
>>He is telling people to not even bother putting their homes on the market unless they absolutely must.
They are attempting to limit the number of listings to their benefit, in order to keep prices propped up.
In our Suffolk, NY real estate office, we have gotten a few dozen new customers so far this year — only catch, they are all looking in the 220K-300K range, which as many of you know, is 25%-40% lower than peak price.
We’re happy to have them; they are the people burned or too smart to have participated in the bubble. Their price range requires we show them short sales and foreclosures, which lead me to see clearly that there are two “islands” in this market: those who bought and/or are trying to sell too high, and the shorts/foreclosures, that will determine the new comps, leaving the former island even higher and drier. These houses are not getting many showings. Also, this am on MLS there were some doozy price drops, over 100K-plus for some chi-chi properties. Those people are in for the shock of their lives.
My original belief was that prices would drop 25% from peak on Long Island, at least in Suffolk, I now see the new median in the 250K-285K range, which would be a 30%-40% drop. BTW, median income is reported as 80-85K, so wouldn’t you know, the laws of finance might reassert themselves.
I have had agents tell me about their clients who are still making mortgage payments, despite being advised to let the house go, to make way for a short sale. My customers can’t afford to pay off their stupid mortgage, so they have to wait until the bank steps in and agrees to take a lower price. At this stage pride is still factoring heavily, but after awhile, not many will be able to pull such a heavy cart.
Anecdotally, I head we lost about 5,000 agents when dues were up, or 20% of the 25,000 covering Queens, Nassau, Suffolk.
my favorite indicator is a saved search I have for housing on a local realtor’s site. when i started following this mess (when i was considering buying) i got 1 page of results for my search criteria (SFH in my price range). It’s now reached 12 pages in just about a year.
This is in the Washington DC area. Most of the homes are still crappy, but they’re starting to look better! Can’t wait for 2009.
I’ve had this same experience. I first started searching for properties two years ago and recall having a disappointing five pages come back for my results. I now have 76 pages to look through.
I have something similar, yet different. A few years ago I started counting how many homes fall into difference price bins for several different zip codes (using homesdatabase.com). For example, 700-800k, 600-700k, etc.
Everytime I did a search, not only did it return the number of hits, but it would also return the pictures. I normally ignore the pictures and just record the hits. At one point, there were no SFH less than $500k. Then I started to see, one, then two, then three, etc. At one point, there were no 3br TH for
I use craigslist with 200000 as a high value in the D.C. area. Used to be i would get 4-5 listings a week, mostly beyond Manasses and those were “fixer upper studios” or something. Now I’m getting 50+ a DAY, 1/3 forclosures more or less, a lot in Arlington/ Alexandria.
Same experience for me. Two years ago, I’d only get townhouses and no SFHs. Then about a year ago, I’d get some SFHs that were small and needed fixing up. Now I’m getting SFHs with 2 car garages and granite counter tops that are bank-owned.
Trying to put lipstick on a serious pig. A loser project from the getgo.
http://www.dallasnews.com/sharedcontent/dws/bus/stories/011908dnbusclifftower.26fc0cc.html
Evergreen managing partner Steve Everbach said the company is busy with other projects and decided to put the units up for sale.
“When we started this project in 2004, we thought it would be a two- to three-year project,” he said. “It will probably be another 12 to 18 months before we sell out.
No . . . the story always was that Californians would buy this pig in a poke. No way anyone local would. Busy with other projects . . . that’s a good one, lol.
My brother’s mcmansion near Atlanta has sprung a major leak and flooded 3 floors. This house is lovely but it was built in 2004.
How do these things happen in a new home?
Was that recently? Big cold snap has come along. In a house that new there is no excuse for pipes being run where they can freeze.
Last year about this time, in California, we had a week of 15-25 degree weather, statewide.
In Newhall, (by magic mountain) a friend told me that pipes burst and flooded a bunch of homes, there.
When I headed out yesterday for some fly fishing lessons I turned down a street in Salinas and passed a newer home with $199K signs posted all over it. I need to go back and check it out. My guess is that it is a minimum auction bid. This house is probably in the 1300 sq.ft. range and two years ago they would have asked and got some idiot to buy it for $600K plus. The sun is starting to break through here in housing. No more loans for strawberry pickers.
I like to take walks in San Francisco, even down angry streets to get an idea of how the worse off are fairing. I walked down past Nordstroms on Market Street (main SF artery) heading West and MANY of the stores are boarded up. Store after store. Some open, most boarded up! Some with going out of business signs. This is literally 2 blocks away from the Hotel district and Union Square. As I ventured on Market st past homeless vagrants sleeping on sidewalks I went North to the Tenderloin district. What I saw was out of some dystopian novel, hundreds upon hundreds of homeless people, derelicts, mentally ill, war vets line the streets, line the shelters, line the missions for lunch. I couldn’t believe my eyes. In sleeping bags, in doorways in the middle of the day. San Francisco has always been a decent place for those without to survive because of the weather and the kindness of its populace, but I have never seen such large numbers of homeless poor. Shocking, like a third world country.
Oliver Twisted…
aladinsane has got it partly right. Read some of Charles Dickens, (although somewhat tedious and an original muck-raker) you’ll get the idea immediately. I read Oliver Twist in the 7th-8th grade, took years for me to get past remembering parts of it and just how bad things were in England at that time.
I’ve been to many “third world” countries and I haven’t seen what I see in US. In “third world” countries, there aren’t as many society safety nets. They work or they die. Darwin at his best
Analysts are often deceiving, numbers say.
December numbers are often deceiving, analysts say
By Roger Showley
STAFF WRITER
January 20, 2008
San Diego County housing prices may have ended in the basement last month, based on DataQuick Information Systems’ analysis of the comparison with December 2006: Median prices were off 13.1 percent to $430,000. The figure is down nearly 17 percent from the all-time high of $517,500, set in November 2005.
http://www.signonsandiego.com/uniontrib/20080120/news_1h20prices.html
The DataQuick numbers appear in today’s SD Union Tribune homes section. As usual, it is quite hard to interpret them for individual zip codes, due to a small numbers problem. For example, the median SFR sale price in the zip code where we live (RB West 92127) is up 15 pct YOY — from $733,500 to $843,750, which makes it seem like real estate is still going up here. But the picture changes when you realize that only four homes sold last month (down from twelve last December), and that the most recent median sales price figure is 31.6 percent below the current median list price for used SFRs shown on ziprealty.com of $1,234,000. I don’t believe this large disparity between median list price and median sale price can persist indefinitely.
The graphs at the bottom of p. 2 of the Home section provide a clearer picture. The “ALL HOUSES AND CONDOS” five-year median price graph shows that the overall median sales price stayed quite close to $500,000 from mid-2005 through mid-2007, before starting a steep 14 pct decline (after the August credit crunch) to its Dec 2007 level of $430,000.
Similarly, the RESALE HOUSES graph shows a mid-2007 median SFR sales price of around $570,000 (which was first hit around mid-2005) before a steep drop to its December 2007 level of $470,000 (a 17.5 percent haircut over less than six months).
And the resales graphs all generally point to a market in the doldrums. Only the NEW HOUSES AND CONDOS graph shows a recent uptick. But the ALL HOUSES AND CONDOS graph shows a December level of 2,468 which is below the monthly sales figure for all months from the beginning of the data (’03) through maybe August 2007.
Here is a rough estimate of how fast San Diego SFR prices have been falling since last August at an annualized rate, based on the observation that there are four months from August (8th month) through December (12th month):
((470/570)^(12/4)-1)*100 = 43.9 pct annualized.
A bottom might actually be reached later this year if this pace of decline either continues or accelerates.
Large auction in Lake Havasu (Mohave area) of homes and lots. I believe the houses were from 320k for 2,000 sq ft and up at one time, i bet this is going to be one fire sale?
Newly built Eastern Iowa condos in the old cornfield were $160,000 are now $180,000.
Local paper says the Boomers are going to the Rockies, I guess Northerners are not getting tired of the cold.
A paradigm shift is hitting local Realtors. For the first time I have noticed, the Realtor comment piece in the Sunday sdhomes BUYING GUIDE reflects 2008 market reality rather than 2005 market fantasy.
What about foreclosures and short sales?
By Rick Hoffman, President and CFO, Coldwell Banker Residential Brokerage, Greater San Diego Company
As you might expect, the buzz around housing has shifted from the boom in the early 2000s, the shift and decline in 2006 and 2007 to foreclosures and short sales.
For those of you not familiar with short sales, here is a simple explanation: A short sale is the sale of a property where the selling price will not cover the full payment of the debt as well as the expenses of sale. To successfully complete a short sale you must obtain the cooperation of the underlying lender or lenders and their agreement to accept less than full repayment of the loan.
…
All aboard!
http://sandiego.craigslist.org/csd/rfs/545401009.html
Reserve your spot on the Foreclosure Fun Bus of Fools now!
It’s in your backyard too!
http://www.boston.com/business/articles/2008/01/20/brokers_clients_detail_web_of_dashed_dreams
NO, It can`t slow down in Charlotte, we`re different than every where else…. yea right. I`ve been hearing this BS for years, I hope we drop like a rock. Even at my own expense, I bought in 2000, a custom build got a fair deal but plan on retiring here and don`t care about the ups and downs.
Okay, so maybe I’m just the envious type, but I was at an aquaintance’s house the other day out here (West Chester/Westtown, Radley Run development) and based on this person’s clothing, demeanor, children, etc. . . I did NOT expect to see what I saw. Radley Run is a nice development, homes built in the 70s (colonials) but hers - oh my God. GIANT McMansion, built to the lot line. Really stands out on her cul-de-sac! They bought in 2003 for about $365K, then refi’ed in 2005 for nearly a million! Then did the “addition” which is basically a new house. How do you do that? I mean, how do you get a loan like that? Now the house Zillows for over a million, but all the rest nearby are $400K-$500K - !!! Quite a difference!
They are always bitching about money so I really didn’t expect this house! Not that I’d ever want something like that (it’s 7200 square feet, granite galore, flatscreens everywhere) but wowzers!
Good article in the LA Times biz section about how the author and his wife sold their Pasadena condo in 2005 to rent, because of what they percieved was a housing bubble. The guy sounds like he is a frequenter of this blog.
Good stuff. Let me see if it is on-line.
Here we go :
Cashing in Before the Crash
http://www.latimes.com/business/la-fi-shortsell20jan20,0,1815515.story?coll=la-home-center
Based on the current score in the Bolts vrs. Pats playoff game, it looks like it is going to be a rough spring in the San Diego housing market.
I now have 5 homes in a row on the other side of my street that have either ‘For Sale’ or ‘For Rent’ signs. The guy in the middle finally filled the gap 2 days ago with his sign. Two house down is a house in Preforeclosure and it appears some kid ran over the For Sale sign with his bike as it’s bent in the middle and nearly flat on the ground. Glad I’m renting!! This is in Bradenton FL……..