Is Your Housing Bubble At A Standstill?
What’s happening in your housing market this weekend? Lots of open houses, probably. Here was one readers’ request. “I want to know how everyones local markets are. I’m outside of Philly (West Chester) and the market is at a standstill with sellers refusing to lower prices just yet and the houses that are selling are the ones priced reasonably.”
“Also inventory, natually, is building up. But just in the past few days of noticed alot of very, very overpriced houses come on the market. I’m talking about houses that are barely $300,000 with an asking price of $400,000 plus. That kind of overpricing hadn’t been to evident so far this spring.”
And one economist sees a weak housing market in New York. “Merrill Lynch & Co. Inc., chief North American economist David Rosenberg says better-than-expected U.S. new-home sales in March are partly a result of price cuts offered by builders.”
“Mr. Rosenberg sees many ominous signs: Over the past 12 months, actual sales are down 0.7 per cent in the United States, but the inventory level has ballooned 39 per cent and an astounding 85 per cent in the condominium market. This backlog of unsold inventory will only get worse before it gets better, he warns.”
“Meanwhile, spending on home renovations is slowing, mortgage applications have taken a dive in April, and a recent survey of home-buying intentions recorded the lowest reading since November of 2004.”
“In New York, Mr. Rosenberg..thinks (housing) is already rapidly deflating in price and resale prices will likely start to deflate this summer.”
Here’s a gem from a northern Arizona paper:
‘SELLER ALREADY LEFT
the state, must sell. Beautifully landscaped corner lot. Two car garage.
Only $499,900. Make offer.’
The ad didn’t even say where the house is! I’m sure that extra $100 off will clinch a deal.
I will say something nice. Mr. Rosenberg of ML has been warning of this publicly for years. He and Mr.Schiller have been neck and neck in warning. Two guys that have not wavered in their warnings. Thank goodness for two straight up economists!
Las Vegas Review Journal 4/28/06
USA Capital - Bankruptcy “Hard money” private lender!
58% of their lonas are delinquent $950 million invested
62 of 107 loans delinquent (nonperforming)
USA participated in potentially illegaly in 46% of the 107 deals
Regulators remarked “Frankly a fire sale is not in the investors best interest!”
In Fairfield County, CT, a 10% discount off of list is a relief for sellers. 20% discounts are what they are negotiating over. They’ll even talk to you if you start at 30% under. But few are relisting at lower prices, they seem to expect to be required to sell at a discount so they try to keep negotiating room. It’s like poking at wood and dicovering deep rot like Pier One wicker.
This is what happened in the UK market. Asking price stays about the same but selling price declines as a percentage of asking price.
DEVO UK keep us informed
I go to housepricecrashuk.com and it seems a 5-10 % after 2 years
where’s the crash
Please tell me where in Fairfield. I have just bid on a home
in Stamford (about 13% below) and they did not even want
to respond to us.
Thanks
New Canaan
I recommend to find five houses you would be happy with and bid 30% under on each of them. Don’t get obsessed with any one house. It will be fun and you may save yourself alot of money. If you have a broker representing you beware that their goal is to get a deal done, so they will try to create the illusion that you must go higher to be taken seriously.
and he’ll give the owners a mild heart attack… fun all around
A friend of mine virtually stole a horse farm this way, back in the late ’90s. She did her homework — horse farms in the area took 1.5 - 2 years to sell, on average. She looked at all of them, them had her agent write up major lowball offers — w/24 hr. acceptance — on her top six picks, with a check to the escrow agent. The RE agent was instructed to make each offer in turn, telling the seller that if not accepted in 24 hrs, she (agent) would present the next offer. Sure enough, seller #3 or maybe even #2 accepted and the deal she got just blew me away — killer almost-new house and great property.
Takes some guts and flexibility, but I think it’s a great way to get a real bargain, if you bid right (read: loooowww).
Why buy in Stamford? Why by anything anywhere right now? The new towers on the north end of Stamford are quite nice. Swimming pool on the upper floor. Nice rentals.
In Rhode Island’s most expensive town the middle range(300K-600K)seems to be in standstill mode, the expensive ones are moving. The asking price is very high and they stay on market, but there are not many price reductions. I wonder who is going to blink first. Could be me, I am just in that time of life that I do need to settle down. This is very frustrating.
Newport?
Last week might have been the beginning of a full blown housing crash in beautiful Hampton Roads, Virginia:
http://www.benengebreth.org/housingtracker/location/Virginia/Norfolk/
After months and months of relentless asking price increases, they suddenly turned south last week after the news about existing and new home prices declining.
I think we’ve got a ton of investors in this market and I think they’ve begun to bail out now that home values appear to be going down. Look at those massive inventory increases — 6.5% last week alone.
BTW those inventory numbers represent only a fraction of the total inventory in this area.
I caught the exact same thing in the HR data, fr.
Almost 25% inventory increase in the last 6 weeks.
Look how the prices are rotting from the head (the 75th percentile) — 2% appreciation in 8 months; almost all of the attempted 10% increase in asking price this year given back over the same 6 week period.
Williamsburg inventory suddenly exploding this week too.
The bubble here North of Baustin has been at a standstill for months and months.Let me look out the window at the house across the way…is it still for sale after 5 months so far???…. hey yes it is!! As well as many others.
I thought the bubble collapse was happening even though there wasn’t much newer construction like in Las Vegas,Florida,San Diego Etc.flooding the market.I may have been wrong.I just noticed a huge condo project near me and recently 200 new apartments and condos are going up without any demand.Pictures of these will probably end up in the Bubble Photo Gallery soon!!!
I’m also north of Boston. Which condo project are you referring to? Are the apartments the ones overlooking 128 in Peabody? If so, I believe that is actually like 400+ units and I don’t know who in their right mind will live in those. Future section 8 circus you’re witnessing there. Anyways, totally agree — the market has pounded the brakes — full on lock. Especially in the $400-500k club. Stuff is just not selling. I use Ziprealty and see the inventory creeping up every day in my city. Let me repeat — no 40 year old split-level ranch in this area is worth $450k, contrary to public opinion.
In Vegas, inventory continues to grow. The permanent weekend open house down the street from me is now in its’ fourth month (time to spruce up your tattered hand-written ‘open house’ sign). No one talks about real estate any more at the watercooler. Perhaps they are afraid to compare notes. Driving around town there are lots of for sale signs as well as signs for homebuilder ‘communities’. Condo asking prices in my neighborhood vary wildly.The entire town seems to be holding its’ collective breath. I am reminded of the tsunami pictures from Asia. You could see the wave coming from the horizon, but you didn’t understand the impact it would have until you were swept away.
How is the Condo market in Honolulu?
I will greatly appreciate anyone’s comments on it.
The price of condos in Honolulu still not dropping but not rising either. I’ve been tracking several flip condos and way way over price. But flippers also beginning to panic. One just sold recently which been in the market since October. Pretty much broke even if fees and other expenses are deducted.
But the number of homes and condos on the market baloons from around 2400 in July to 5600+ today taken from MLS listing (www.hicentral.com). I think it will continue to increase especially with all the new condos that are under construction ( I believe around 17 projects) that will eventually flood the market . I just hope mainland investors stop snatching these condos so that I can buy one later and also other locals that they call Hawaii home.
Without foreign and mainland investors, I believe history repeats itself again. Crassshhhh!!!!!
for comparison the bubble news from the Netherlands
The Dutch bubble keeps growing slowly. Over the last year average prices increased by 5% (in some outer regions +20%), sales are more or less stable and inventory increased by 25-40% (no reliable source for this …). A large chunk of the inventory has been on the market for more than a year.
I’m seeing more homes coming on the market at hugely inflated prices, discounts are extremely rare (there were far more discounts 1-2 years ago). Open houses are more popular lately, most often it’s an ‘open house route’ where you can visit 10-20 in a short time (more efficient for the realtors I guess).
Both the realtors and the banks are predicting at least some nice gains this year (up 5-10%) and maybe a new surge in prices. That is despite increasing construction, stagnant wages, rising costs for almost everything, slowly rising mortgage rates and declining population (just to name a few fundamentals but as we know, fundamentals don’t matter anymore).
With the announcement of slightly higher rates from the ECB there seems to be another surge in home refinancing. Many realtors are focusing on investment properties in other countries, often outside the EU (which probably indicates that they think the time of huge gains in the Netherlands itself is over, or selling a local property takes too much of their precious time).
A recent ‘innovation’ are mortgages for foreign homes. This used to be impossible until recently (you had to arrange that in the country where the property was, which always had far higher rates than the Netherlands). Within a few weeks there are suddenly many banks offering those mortgages at very attractive rates - beware, the Dutch are going to buy all available investment properties outside the US
nhz:
> Both the realtors and the banks are predicting at least some nice gains this year (up 5-10%) and maybe a new surge in prices. That is despite increasing construction, stagnant wages, rising costs for almost everything, slowly rising mortgage rates and declining population (just to name a few fundamentals but as we know, fundamentals don’t matter anymore).
What about rents? Are they also increasing with house prices, or are they decoupled from house prices like in many parts of the US since 2001? If both increase, a case against a housing bubble could be made; after all, population in the Netherlands is dense and a larger percentage of income has to spent on shelter.
rents are mostly decoupled from house prices because they are heavily subsidized and subject to all kinds of rules that limit price increases (never more than CPI, which is artificially low) and favor certain types of renters (e.g. people on social security) over others.
The government tried to get a less regulated market this year (mostly to help owners/developers make more money) but without success until now, because there is a huge lobby who want to keep their huge subsidies. Obviously, many of these people are living far beyond their means (e.g. I know some people on social security who live in one big home all on their own).
Only a fraction of the more expensive homes / apartments are rental properties, and those have very high rents compared to the subsidized system. Probably these rents are increasing more than the CPI (but there are so few of these rental properties that you can hardly call it a ‘market’). Most of it is geared towards temporary workers who need a home for a year or so, and for whom the employer will pay the rent.
The major problem with renting out a home here is that to get a positive cashflow you have to charge a rent that hardly anyone can afford. People who could afford it usually choose to buy, because owning is subsidized even more than renting. Because it is difficult to terminate the rental contract once someone is in, most owners prefer to leave the property empty instead of renting it out. With an average 15% yoy appreciation over the last 10-15 years, there was no need to rent out anything …
I think you mean welfare or “public assistance” rather than “social security”. The latter generally refers to the forced pension scheme that exists in the US.
here in manhattan coops and condos are selling if priced lower than the norm of $1,000 per sq foot. Otherwise those priced at $1,000 per sq ft are sitting. Inventory seems to be building there nare many open houses.
In South Orange County…seen many on the market for over 120 days. These are finally getting reduced…not by much but…reduced none the less.
Side note- ocregister.com blog
Real Estate investor…thinks OC median might crack 500K by 2010…
http://blogs.ocregister.com/lansner/archives/2006/04/insider_qa_housing_bear_bruce.html
How is the Bakersfield market - Inventory #’s:
This week inventory up 4.059% x 52 weeks = 211.07%
This month inventory up 13.71% x 12 months = 164.52%
RE prices here in Connecticut have not risen in a year-
I know about plateaus, then a decline in prices- went through that in 1989-1990- a pause then endless declnes for the next 6 yers-gets ugly. Good part is that we are not overly over extended like 16 years ago- bad news many areas outside of New England are-
New Jersey market has come to a stand still. A lot of over priced, low quality homes in the 550-800k range. It is a joke.
Seattle is in the midst of a “dead cat bounce”. A lot of “Sold” signs on properties that did not last long on the market.
Seattle is one of the last dominos to fall and our fate is linked to CA.
Seattle will mirror whatever happens in CA with a lag of about 6 months.
Properties here are 20 to 40 percent overpriced.
I’m curious SeattleMoose - I hear a lot of crap by people out here about how it’s different, they don’t make land anymore out here yada, yada, yada. Any idea about inventory? Prices are ridiculous here for the size of houses. Still wages are better than some areas with the tech stuff…Honestly, I thought Florida was insane but it’s off the wall here. Why behind the curver so much here and any direct info on relationship to California? Curious…thanks for any thoughts.
Pepe - I was transferred to Seattle from Texas in September. We got here right at the height of “the frenzy”. A house goes on the market at 10AM for 390K. By noon it has sold to the highest bidder for about 50K more than list. People didn’t even bother to vacuum or pick up the dog poop in the basement. They knew it did not matter. I have never seen anything like it in my life.
I don’t see that anymore. There are even a few “price reduced” listing which were nonexistant last year. Worse, there are “tricks” being used by the RE folks like taking a house off the market that isn’t moving and then relisting it a month later with a new MLS. That should be against the law but we are not talking about an industry with any moral/ethical standards. When your only stockholder is your stomach….
There are several factors driving Seattle prices thru the roof the last few years:
1) Low interest rates
2) Exotic mortgages (well over 50% of all loans in Seattle of this type last 2 years)
3) Boeing/MS hiring like mad the past couple of years (that is now ending)
4) CA equity refugees (since we rent in “high end” complexs almost every other license plate if someone who sold his POS in California, pocketed a cool .5M, and is waiting to buy a much nicer place up here. Problem is that the ones I have talked to hated the wet and gloomy winter and are reconsidering.
5) Flippers - this is what is different this time than other RE booms. You have all the “I don’t trust Wallstreet” folks looking to retire early via some other route and the low interest, no down, anything goes loans allowed everyone to leverage much more RE than they ever should have qualified for. This is the pyramid/ponzi part of the equation and quite frankly, I believe flippers and “investment clubs” are the true root of the problem (along with the loan/RE industry). Time will tell. I can say this, almost the rental homes we looked at were empty, in poor shape, and generally pitiful homes that are the trademark of someone just sitting on it and waiting to walk away with a bag of cash.
You have zillow.com as a really good weapon/resource to fight against all the BS that the RE industry broadcasts. Check it out. You can trace the price of any home back to 1997. Then take that 1997 price and assume 4% appreciation. I base my 20 to 40 percent overpriced range on analysis of home using Zillow.
Good luck to you and I hope you find the place you want!
Australian market has been in decline since 2004. Sydney off about 10-15%. The only area showing growth is around Perth and Darwin due to the commodity boom. Shanghai off 30-50% in nine months in condos. They are supposted too have the money? This thing is world wide and if it tanks its affects will be very serious.
North San Diego County:
Same as before. Lots of inventory, seems to be building more slowly now — maybe some homes are being taken off the market, perhaps they have sold after a long time. Houses are still selling, though. We’ve been at that plateau for almost two years now. Sales are down, YOY, and listings up, YOY since 2004.
IMHO, we need to get rid of the suicide loans before the market really starts to turn. Too many people looking for 10% off. They are finding these “deals” and financing is still readily available.
West Chester (near Philly) certainly does seem to be full of “for sale” signs this spring! We’ll see how they do.
Our neighbors down the street have been trying to get $490K for their 3bed ranch for over a year. They had bought it the year before? odd. I seriously doubt there are any comps here that high.
A little more info on the West Chester area: I’ve been tracking inventory in the West Chester, Unionville and Kennett combined school districts since last June.
Started at 784 on 6/2/05
The high point last year was 812 on 6/24/05
Low point was 677 on 1/6/06
Today, we’re at 917.
Because I’ve been tracking for less than a year, I don’t know if we’ll see a decline towards June back to levels of last year, as part of some normal inventory curve, or whether we’re really seeing a move up this year. Time will tell!
But meanwhile, houses that are priced right are being snapped up pretty quickly. (One new lsiting I was interested in went under contract this week before I could even get in to see it). But a lot of stuff that I think might have sold a year or two ago at the current asking price is just sitting.
I don’t think there has been a lot of flipper/speculation in this area for SFH, or I would think I would see a lot more houses for rent. If this area has problems, my guess it would be from all those ARMs adjusting. Plenty of McMansions here!! I often wonder how many have furniture in every room? I think a lot of people here are in hock up to their nostrils, keeping up with their neighbors in Humvees, plasma TVs and supersized houses.
Sounds like we’re looking in the same area. Although I check out Downingtown too.It’s slightly cheaper there and the schools are OK but the closer ya get to Coatesville( nobody wants to live there) the cheaper the houses seem to be. Your right about houses that a priced right going quick too. 275,000- 310,000 ish 3-4 bedrooms with a yard is gone within a week. West Chester for a 4 bedrrom colonial is still 360,000 and up. Unionville/Kennett $400,000 and up. I’ve also noticed alot of houses just being taken off the market when the sellers don’t get their price. We’re hoping for some bargains come late summer but we’re not counting on it.
I live in San Diego, closely watched by many as one of the riskiest markets. My family lives in east Chula Vista, a suburb that just had an explosion of tract homes, planned communities, and home prices that have more than doubled the past 3 years. I consider this area, moreso than any other area in San Diego, the place to most likely to experience a crash.
A friend of mine lives in San Miguel Ranch, one of the many new “ranches” in east Chula. He told me that several homes went on sale last fall, most are 2-story, 5-bedroom, 3000-3500 sq. foot homes, and were priced in the $900g’s to just over $1 million. Today, all of them are on the market still, and have reduced their prices from the high $700g’s thru the $800g’s!!
Also what concerns me are the number of young couples/families who bought smaller homes and condos in these same areas. All of my high school friends who are now married and bought homes in here used ARM, I/O, or Neg-Am loans. My brother’s GF became a loan officer 3 years ago, who serves clients in the area. Last summer, I asked her if a lot of people were still using 30-year fixed-rate mortgages. She said to me “Are you kidding? Those are extinct! Nobody uses those loans anymore!” Yikes!
Can you believe that as recently as the early 90’s, Eastlake and Otay Ranch didn’t even exist as communities? Just cow fields on the way to Jamul. That must have been about the time when they stopped making land.
Inventory increases for Fairfax County VA (Northern VA)
April 1 to April 29 2006 +24%
April 1 2005 to April 1 2006 +500%
http://www.virginiamls.com/charts/FairfaxCounty.htm
Up here in Canada, just north of Blaine WA houses are selling like hot cakes. As far as I can tell the bidding wars are still on, and houses are sold within weeks of listing. Some locals are beginning to consider a bubble but it seems like people won’t be happy until an average house costs at least 1/2 million dollars. Construction is frenzied, there are sometimes rows of old houses torn down and new SFD homes are being put up in quantities. The madness is still well under way, devil take the hindmost!
Across the water in Victoria BC the market is now falling. I have been tracking properties, some have seen two 5% reductions in asking price (some with new MLS #).
Greater Vancouver has the same “we’re different and RE can’t go down” mindset as SF or NYC. People talk about the upcoming 2010 Winter Olympics (which most people in the world pay no attention to) as if it were the Second Coming of Christ.
Well, Vancouver, I’ve been to NYC, and I can tell you, you’re no NYC.
Anyone who thinks the coming RE debable will stop at Zero Avenue is kidding himself.
Well said both. This spring is BC’s final run-up, where the curve gets steepest just before the peak.
Central Florida - Brevard County
One developer here is dropping prices every week . They put up the list of homes for sale or homes that are under construction, on their web site. I check it every day (yes .. I need help).
I was interested in the Arlington model at the begining of April. Asking price was $245k with $5k towards closing. The price now is $215K with $5k for closing.
A bigger model (200sqft more) in another of their development was going for $255K. Now it is $210K.
They are building even more.
They are still over-priced by about $50k .. based on what the prices were in 2004 and 4% annual appreciation.
Funny thing is, Realtors and Invetors are still trying to sell the same houses, in the same communities, for $40-50K more. Good luck to them !
FL_bust: Which builder is it? I live in Orlando and have been following the prices of about 18 homes in Titusville and Melbourne on brevardmls.com over the past 3-4 months. About a half of them have reduced their prices, some more than once. A few realtors have resorted to tricks like changing the listing description to say, “Financing fell through,” or, “72 hour contingent kickout…continue to show,” as if this will make the houses seem more desirable. It’s pretty sad.
This kind of nonsense is what you would expect when you have 100’s of bored realtors sitting at their desks diddling themselves while staring at their phones, hoping they will ring.
More power to you, but I would not buy a home that “gets down” only to 2004 prices. I want a home that sells for 1999 price-per-square foot. You can adjust that upward a bit for the improvements in code requirements, like the roof trusses/clips and bank-teller windows, but that is where prices should be, IMO.
Presumably, these homes are in Viera or Palm Bay.
“Standstill” — yes. I would liken the current situation to the calm before the storm. SD inventory is steadily building, approaching 20,000 (higher than at the end of the last housing downturn as of 1995), albeit at a slower pace than in early 2006. Some folks are still buying, but at a markedly lower pace than 1 year ago. There are fewer open house signs up on the weekends than there were last fall, despite the larger number of homes on the market.
I see Noah Gamer has 21,507 homes. I see more FSBO’s out there too, including some beach front places.
I also see one house in escrow that’s had the sign up for months. Nothing is moving, lots more people (including the neighbor next door) are in a mad panic to put new paint on and sell. Supposedly the guy is having an open house tomorrow but theyre still pouring cement for a carport today (maybe thats part of the plan, trap potential buyers). Also, twice in the past week someone has tried to siphon gas out of my car. There are so many homes that are offered for 1.3 to 1.8 million in SD county its incredible. And a headline in the newspaper talked about city leaders struggling to come up with solutions to the housing shortage. What fking planet are they on?
Saw a guy putting up an open house sign at 10:30 this morning in Rancho Bernardo. Nicer neighborhood in San Diego’s north inland area. Guy’s car was some POS old enough that I couldn’t even tell the make until I saw the Toyota on the front grill. Must have been a late 80’s corolla(?) or something. Dude was like 32-ish. Wonder how long he’s been in the business?
Unfortunately I disagree. There won’t be any storm. It will be (is) a quiet, low volume slide. Sellers who don’t have to sell won’t. And the few who must, will sell to the buyers who can’t wait until next year. And it is underway.
It’s barely begun, that’s why you’re only seeing a low volume slide. We’ve barely edged over the peak of a parabolic curve, and it gets a lot steeper ahead. These things always end with bang, not a whimper.
What is you time frame?
Many would-be sellers are still in the denial stage of a correction — expecting the market to come back soon, and patiently awaiting the time when they can sell at a higher price than recent comps. Once they figure out this time is maybe ten or more years off, the mood will get much more frantic, as those who cannot manage their cash burn rates will dump.
Condo market in Honolulu?
Does any one know how that market is?
I will greatly appreciate your comments.
Seeing lots of inventory in Northern NJ, and houses sitting for 60+ days. Some sitting for much longer.
I’m also noticing that all but a few houses which closed the last two months sold 10% or more below asking. That certainly wasn’t the case in 2005.
The bubble mania is over, and now it’s time to keep saving and wait 12-18 months (or longer) before possibly making an offer.
Anyone know what is happening on the Jersey Shore. Long Beach Island? I have friends that are trying to flip down there but to no avail.
problem with the jesrey Shore is that realtors convince the buyers that their homes will carry themselves with the owners getting a couple weeks “free” weeks of vacation use out of them. Usually takes a year or two before reality sinks in and they sell and the process repeats itself. ( Had one realtor state recently that a unit “would be cash flow positive if you didn’t have a mortgage” to justify a high price.)
This is all well and good in a rising market as the previous suckers don’t complain too much because their houses go up enough for them to at least break even. But when prices go down it will suck. I would tell your friends to set their price just above break even and get out with their heads still on if they don’t have the $ to carry a place for several years.
“…cash flow positive if you didn’t have a mortgage…”
It is difficult to imagine anyone having enough money or credit to buy a place being so stupid as to fall for a line like that. Reminds me of the joke about the guy with the ill-fitting suit. Perhaps this is where some inherited money is going.
Lots of condos in my development for sale (Walnut Creek CA)– many “reduced”.
One 3/2 was reduced from $559 to $539.
So imagine my shock when I saw a open house (for Sunday) on a 2/2 (1500 sq feet) listed at $639!!!
(WHAT???!!!)
I have to go tomorrow to see if they installed one of Saddam Hussein’s “golden toliets” or something to justify that insane greedy price.
A 2/1 just sold next to me for $425 and the average around here ranges from $480-$540.
Even at that price, these old condos, built in the 70’s and early 80’s are overpriced.
That 3/2 I mentioned reduced to $539 was completely redone.
I can’t stop laughing. I sold my 3/2 1900sq ft house in LA last June for $520.
And this clown wants $100 K more for a condo??
It’s in the next development and the development isn’t nearly as asthetically pleasing (no grassy areas etc).
I’m shocked.
CA Central Coast:
Inventory keeps rising, especially in the outlying areas (e.g. Paso Robles) where people started buying after housing became less affordable in more central locations like San Luis Obispo. Prices have been essentially flat since last fall. I am seeing open house and ‘for sale’ signs everywhere. And properties that appeared to have been sold have ‘for sale’ signs on them again. Dunno if they were taken off the market and then put back on, fell out of escrow or what. But it is clearly NOT a healthy market right now.
I’ve heard that quite a few fall out of escrow either because the appraisal doesn’t come in (what a change!), or because of an inability to sell the buyers’ houses in a timely manner.
Also outside of Philly - but on the other side of town from West Chester (Hatboro/Warminster area). LOTS of open houses today. I drove by several - got out of my car for none.
I’ve been tracking inventories for several months in two school districts around here that I’m most interested in for my son. Both inventories had been growing - however both dipped a bit in the past week. And I’ve been noticing several “SOLD” signs on homes that have been on the market for some time. I’m sure curious as to what they sold for (tho’ not curious enough to do the homework).
It’s anybody’s guess what’s gonna’ happen long term around here. Frankly, I don’t care what happens to the high end market - if you can afford a home for $500K, you can probably afford one for $600K. And lucky you. It’s the lower end that is frustrating to me. I’m sorry, but I just don’t think “starter” homes should cost over $200K. Nor should 950 sq. ft., single story condos. Nor should the no-frill townhomes.
Went to Bucks Cty (No Hope area) yesterday to look around. LOTS of properties for sale, especially the “quintessential Bucks County 18th C farmhouse” type that’s been done-over to the nines. My guess - the ‘NY Weekender Country House set’ (both Wall Streeters and gay couples) is pulling their money out of excess real estate.
OTownCajun .. I have noticed their scams too. I have seen listings getting pulled, then coming back on the MLS system, with new pictures and descriptions. I use the MLS so much, that I think I know the meaning of the letters at the end of the MLS numbers. The “W_” at the end of the MLS number stands for withdrawn. The “A” stands for available. “C” stands for under contract and “P” stands for purchased.
I have seen a lot of listings going to “C” and “P”, but coming back on MLS a few weeks later. I DO NOT TRUST RE AGENTS !
The builder’s site is maronda.com … they update the list every other day ..
I was interested in the Arlington model in the Preserves at Lakewashington. Many empty lots there.
I just drove by Fairmont, and they are still building … and there are many empty lots.
The prices are still too high .. give it 6 months and they will start selling in the 140’s or 150’s.
Remember, Maronda is one of the cheaper builders, so some of their homes are butt-ugly, and they use cheap materials.
A means Active. C means Cancelled. W means Withdrawn. P means Pending. S means Sold. Houses may go pending for months as buyer and seller agree on a closing date that may be far in the future. In Portland, OR I’m seeing several listings cancelled or withdrawn and relisted. Inventory here is slowly rising. About half of the listings the realtor sends us sell. The other half sit on the market or are withdrawn or cancelled.
One correction — “C” means “Contingent.” This is the step before “Pending,” where all contingencies in the contract — inspection, LOAN QUALIFICATION, etc. — must be met or the buyer can back out. I will bet that there has been a huge increase, in the past year, in the number of Contigents that did not go Pending, that most fell through because the appraisers now are scared to death and are unwilling to pump an appraisal just to get the fee.
More — some MLSs now use K for contingent and C for closed (sold). But none use any term for “cancelled.” The statuses (stati?) are: Active, Contingent, Pending, Sold, Withdrawn and Expired. No more, no less. Web sites may add a category of New Listing, but that is not an MLS status, just a statistic.
N VA 22151
stuff is selling ,but may 2005 prices
we’re getting a boost from gas prices cause we’re close in
Boston isn’t at a standstill. It’s a snowball rolling down a hill at the moment. The real rate of change in year over year prices started decreasing after November 2004, hit negative territory in September 2005, and it keeps going lower. Check out the graph at http://www.bostonbubble.com/forums/viewtopic.php?t=65
Here in Reno, reality hasnt hit the sellers yet. Hardly any open homes this weekend. On Reno’s Craigs List, there are sellers & developers listing properties daily like there’s no tomorrow. I have noticed a few sellers offering to assist in closing / pay for closing costs and even an occasional seller offering a “second”. I havent seen this kind of action since the last RE bust. It’s starting to get good. Where’s the popcorn?
• According to an MS-NBC story dated April 24, “The Housing Bubble Has Popped” as inventories swell, sales decline, prices soften, lenders are raising rates and the first signs of panic start to appear. For those who have followed the housing bubble closely, you know that this is a global housing bubble and that these trends have become apparent from the UK, to Australia, to Japan. Along with falling house prices and a drying up of credit, over-stretched consumers now face very difficult choices as they are forced to decide between driving, eating, paying their bills, or having a place to live. This particular collapse is just beginning and the world economy must follow its lead.
OK, Gotta share this. After an RE handed me a flyer at a local open house here in Thousand Oaks, CA…
She said “And I bet you’re looking for the price that isn’t printed on the flyer”
I said, politely “Of course. Why would you not print it?”
Her Reply “These days, with the prices dropping so quickly, we’ve been wasting a lot of flyers”
After going to five open houses, three homes were reduced.
Typicaly, the reductions are still not very significant. Occassionally you’ll see a $30K or $50K reduction, but many times its just a teaser. For example one was reduced from $720K, then to $710K and then to $709K, this weekend.
Her Reply “These days, with the prices dropping so quickly, we’ve been wasting a lot of flyers”
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Excellent story!!!
I went toone open house, large beauty about 20 years old.
Price a bit more sensible but still 30% more than I would pay. Taxes too high for impending retiree, too large and I did not go into the engineering issues like heating and cooling systems.
Nice to see a little more “reality” from realtor. Something about “going fast even in this market”.
I hope she can afford the payment on her Rover.
House price futures start trading in one week. Market expectations will be in the open. That will be the final nail in the coffin.
In Rhode Island, Inventory continues to grow, more than double from last summer. The only thing selling in volume is the lower end. Medium and High End housing are not selling at all. If it is priced right, it will sell eventually. I have also seen a bunch start out high the sell at up to $75,000 off of asking. These are 330K to 430K range homes I am talking about. Time to low ball and if they really want to sell they will lower the price a bunch.
Since so many people enjoyed it I’ll post it again:
Modern Western
Yes, the the south bay market is very much at a standstill ! I’ll be posting the April charts probably tonight and tomorrow.
This sunday was a lovely day in ann arbor MI…stopped at a couple open houses at the end of the day for hubby’s benefit since we were out anyway and he noted almost no sign-ins or traffic. There are a lot of new listings with silly asking prices, some really silly. It almost feels like in some places the realtors don’t even expect anybody to bite at them. I’ve noticed a lot more listings where people don’t even show the asking price! wtf? is that a technique to get people to at least appear instead of discounting it altogether? certainly my husband doesn’t even want to walk into a place if the asking isn’t in our range…I keep reminding him how many of the places we’d been considering in the winter and fall were once out of our range but came down. But in general there is the new slew of homes priced “to sit”!
There was a funny piece in the local monthly publication called the “observer” where forever there has been over-optimistic “information” about RE. When houses were selling like hotcakes three years ago they would show their housesales map brimming over with sales points so that you couldn’t even read all the data on it so crowded was the graphic…and they’d proudly tout the numbers sold and the price increases. For the last year, even while the AA News has had to admit to crappy sales numbers, they would run silly little bits of fluff on for example which realtor sold the most last year or other flotsom.
This past month to accompany their sparsely populated map they finally dealt at least a little with the obvious, though they started the piece, in bold, with the line
“Sales of new homes increased in 2005 over the year before.” Funny…hmm…wait!….this is 2006! They counted 20 more sales in 2005 than in 2004, but sales “…of new homes so far this year are down dramatically. We found only 48 sales in the first quarter of 2006, fewer than half…(than) during the first quarter of 2005. Winter weather has caused dips in sales stats in the past, but nothing of this magnitude (this btw was an incredibly mild winter). And the builders we asked refused to blame the weather. The automakers could easily have been blamed for rocking the boat, but nobody tried to blame them either. Pierre Nona, the VP of Triangle Builders of Arbor Woods, dismissed the lag in sales as a fluke that wouldn’t last. And Toll Brothers sales rep Deborah Bokano was upbeat about the prospects for Arbor Hills sales. The president of the Home Builders Association Geoff Perkins was less concerned about the slip in sales than he was upset that talk of a downturn might produce a snowball effect that would drive sales down further. Are buyers really that skittish? What scared them, and where could they be hiding? Perhaps the condo towers proposed for downtown Ann Arbor can provide a solution to our math problem–and shelter for our missing buyers. Reservations for condos in Ashley Square, for example, are reportedly going fast. Reservations help explain the gap in our stats if these buyers are signing reservations for the condos on the drawing board and waiting for construction of the units before they close their purchases. In that case, much, if not all, of the drop would be due to a delay in sales while construction catches up with demand. ”
Very amusing, and illustrative of both the snide smugness here…assuming that demand is a given, speaking of “a little math problem”, and the missing ’shelter’ for ‘our skittish buyers’…makes me wanna puke on the free upgraded landscaping, blech.
and also illustrative of the deep deep denial (as well as mounting fear on the part of the homebuilders) that this town is likely in. Even the new homebuilders supplement to the local news stated that the thousands of jobs they claim will be added to the local economy over the next 5 years are so are almost all ’service’ jobs. That won’t be buying the toll bros abodes, or even the downtown condos small as a ‘closet’, the size one more experienced local developer claims all the new proposed projects will have to build them if they are to meet the price point he sees most in demand, under 300K. They apparently also haven’t caught up with the national scene, whereby reservations aren’t quite the same thing as purchases, as developers in FL and NV may be starting to realize. And what would make *any* “analyst” believe that the market for little downtown loft condos and 2500-4500 SF homes in the exurb areas share a buyer demand base?!
Whatever you do, builders, don’t blame the auto companies, responsible for the surge in listings from existing home sellers, some of whom are reportedly (reported elsewhere in the same edition of the observer as the above RE analysis, but again claiming that this is not Ann Arbor’s problem, just the towns immediately adjacent) trying to sell *in anticipation* of their jobs being cut in the near future, as well as from those who have already taken buy-outs or lay-offs.
It’s not just the ’standstill’ that’s annoying…it’s the obnoxious sense of un-reality that makes you (me, anyway!) just want to grab some collars and shake vigorously!