May 24, 2006

Record New Home Inventory, Up 27% YOY

The new home sales numbers are out. “Sales of new homes rose unexpectedly in April to the fastest pace this year as the housing sector showed resilience in the face of rising mortgage rates. But the price of homes sold last month fell and the level of unsold homes rose to a record high.”

“The unexpected jump in April home sales was not likely to change the overall view that the booming housing industry is beginning to cool off. Even with the increase in the April sales pace, the median price of a new home sold in April dropped by 7.3 percent from the March level to $238,500.”

“The backlog of unsold homes rose by 2.4 percent to a new record of 565,000 homes on the market at the end of April.”

“Sales increased 4.9 percent to an annual rate of 1.198 million. Builders broke ground on at an annual rate of 1.849 million, the Commerce Department said last week.”

“Federal Reserve Chairman Ben S. Bernanke and fellow policy makers are watching the housing market as they weigh whether to extend a two-year cycle of interest-rate increases. ‘The housing market is not cooling as much as Fed officials were anticipating,’ Said (economist) Chris Rupkey.”

From the Commerce Department PDF; US New Home Inventory.

4.04..383,000

4.05..445,000

4.06..565,000

From the Wall Street Journal. “An estimated 107,000 homes were actually sold last month, down from 110,000 in March, based on figures not seasonally adjusted.”

The April 2005 number sold was 116,000, not seasonally adjusted.




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167 Comments »

Comment by dc bubble
2006-05-24 06:28:53

Developers are discounting new condos in DC like crazy. Maybe the sales are up because of all the prices cuts. Lots and lots of supply.

http://dcbubble.blogspot.com/2006/04/airline-style-pricing-for-condos-you.html

Comment by KirkH
2006-05-24 06:50:46

That would explain the median price drop. “the median price of a new home sold in April dropped by 7.3 percent from the March level to $238,500.”

Can that possibly be correct?

Comment by Nikki
2006-05-24 06:53:27

Ummmm, the median sales price in March was 224,200 and this month is $238,500…that’s not a 7% drop, I think the AP is wrong. Check here
http://tinyurl.com/s6te9
for a different story not from the AP.

Comment by Ben Jones
2006-05-24 06:58:28

The march median was revised and I think this has the reporters confused. The PDF shows an insignificant YOY increase. The 2% inventory increase is M-O-M.

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Comment by Nikki
2006-05-24 07:01:45

Was the March median revised up or down? WHo’s confused–the AP or the article I quoted?

 
Comment by Nikki
2006-05-24 07:04:46

Never mind, I see it at 232,000 in March and 238,500 in April. That’s still not a decline, though, so why are they saying that?

 
Comment by Backstage
2006-05-24 08:51:18

The y-o-y numbers, as reported by bloomberg are more telling:

” The number of unsold new homes fell to 5.8 month’s worth at the current sales pace from six. The median price of a new home rose 0.9 percent from the same month last year, to $238,500.”

1% in a year. That cant be good news for investor/speculators.

 
Comment by feepness
2006-05-24 09:21:36

Why in only 7 years they’ll be able to pay commissions with a 0.3% profit to cover the carrying and remodeling costs!

 
 
 
 
 
Comment by David
2006-05-24 06:33:17

The price discounting and incentives that homebuilders are offering are causing price declines. These price declines have brought some new buyers to the table. This has TEMPORARILY increased the number of new homes sold (the longterm trend is down). New home sales are also taking away from existing home sales.

David
http://bubblemeter.blogspot.com

Comment by PW
2006-05-24 06:37:03

many builders are now offering substantial sales incentives in the form of decorating allowances, landscaping allowances, loan points/closing costs paid, etc.

if these were netted out against the recorded sales price, actual prices would be much lower.

Comment by Ben Jones
2006-05-24 07:05:00

Good point.

 
Comment by OC Max
2006-05-24 11:09:16

Good catch. Part 1 of the downtown includes the new homebuilders giving incentives, while existing home sellers just act stubborn. Part 2 will include actual lowered prices by all. I can’t wait.

 
 
Comment by wawawa
2006-05-24 06:58:41

Developers (by discounting prices) are trying to squezz last drops from this lemon that is going soar quickly.

 
 
Comment by Chad Day
2006-05-24 06:35:31

I didn’t buy this month, but I did buy in Feb. 2006. And yes, I was reading this blog before. Looked at over 10 houses in a development I liked before finding one that, believe it or not, seemed reasonably priced.

News like this makes me wonder what’s going on. All this inventory and all these ARMs due to reset, yet sales keep trucking along.

Comment by Ben Jones
2006-05-24 06:53:27

Sales are falling:

Sold during period in millions, annualized.
4.05..1.27
5.05..1.311
6.05..1.272
7.05..1.367
8.05..1.271
9.05..1.253
10.05..1.346
11.05..1.236
12.05..1.259
1.06..1.173
2.06..1.02
3.06..1.142
4.06..1.198

This is supposed to be the saving sales season? Price distribution explains the median. Fewer less expensive homes are selling. That’s been common to all the bubble markets.

Comment by nnvmtgbrkr
2006-05-24 07:25:38

Excellent point Ben. Actually, and unbelievably, this was reported on Bloomberg this morning. An analyst commented not to be fooled because the over all trend was downward.

Also, I think I’m correct in saying that the new home sales number aren’t closed contracts, and don’t take in the possibility of cancellations, which are rampant these days. I think the existing home sales are a better indicator. That’s tomorrow, right?

Comment by Ben Jones
2006-05-24 07:40:36

Yes, tomorrow. New home sales are a more current indicator than existing sales, which took place further in the past. But with the cancellation factor and the statistical irregularities, it has many faults. The NAR pending sales has been tracking down for months, and that’s supposed to be the most forward looking.

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Comment by NOVA77
2006-05-24 16:03:31

those are actually seasonally adjusted numbers though, keep that in mind. And again, as was pointed out above the price actually increased this month. However, as I have said before the median price means nothing. It simply reflects the price of houses that sold not the value of houses on the market.

 
 
Comment by Derek H
2006-05-24 08:02:46

Where do you live, Chad? (Please don’t say Vegas, SD, Phoenix, or Miami :-( . Some markets aren’t that bad right now.

Comment by Chad Day
2006-05-24 09:33:34

I’m about 15 miles east of Charlottesville, VA in a town called Palmyra. It’s pretty rural out here, which is why real estate didn’t seem completely insane (I moved from NoVA down here). 3 BR ranch house, 1 car garage, half acre of land in a nice community (lake, golf course, etc) for $229k. Other houses I liked that were similar were going for $250k minimum.

 
 
 
Comment by notme
2006-05-24 06:40:53

Look at the actual numbers, April sales numbers are actually lower than March. Only way to say it is higher is to “seasonally adjust”

Comment by bluto
2006-05-24 07:30:38

But what that means is in every year April shows a decline in actual sales from March, in this year the March/April drop was less than an average year (so the seasonal adjustment means a larger annualized sales figure). You can check their math, the adjustment factors should be consistant for a given month.

 
 
Comment by sellnrun
2006-05-24 06:41:37

Everyone needs to bear in mind this is a statistically unreliable report, as the margin of error is huge with all of the data provided…

Comment by Chip
2006-05-24 07:09:53

And all of the new-home sales being reported are just contracts with deposits, NOT closings. My guess is that the percentage of buyers who walk on their contract is increasing; if that is true, then the reported “sales” numbers will be increasingly unreliable.

 
 
Comment by shel
2006-05-24 06:43:58

is this what a bubble unwinding is “supposed” to look like? I thought sales were ’supposed’ to continue to slow, with prices staying steady or even rising a little…
sorry for the ignorance..I know this has been covered before, but I forget.
Looking at the market today has been interesting…does it look like durable goods orders being low causes rally because the only thing WS rallies on now is a hope for a stop to Fed tightening?! I’m new to watching any of that, but it’s so fascinating how the indices go up so regularly lately on news of *slowing* economy in hopes that this means lower interest (more credit?) rates. It almost makes me wonder what the effect of a real nasty event, like a new terrorist attack, would be. The markets might rally, on the expectation of a return to near-zero Fed funds rates…how bizarre.

Comment by crispy&cole
2006-05-24 06:46:46

DONT FORGET! 20-30% cancellation rates are not included in the sales numbers. IF SO SALES WOULD BE DOWN!

Comment by Getstucco
2006-05-24 06:50:53

Amen, brother — nonetheless, Wall Street has focused on the headline information that “sales were higher than expected” and is giving the HB bull new legs …

 
Comment by robin
2006-05-24 18:03:42

True, but cancellations were not reported in the previous period, either. So not an exact comparison until we adjust for the far higher rate of cancellation we are now experiencing. The true number is somewhere in between but favoring the downside.

 
 
Comment by jms969
2006-05-24 06:54:19

It is called a dead cat bounce…

Home builders are offering incentives to push through as many houses as possible, hence the drop in median price and rise in units.

Keep the faith, it is all part of the meltdown.

IMHO

JMS

 
Comment by cabinbound
2006-05-24 07:43:15

shel I believe you have it just about exactly correct: it’s all about interest rates these days.

This is indeed what a slowly collapsing bubble would look like, and I agree with you that this is really unwinding rather tidily so far. I’m still waiting for a decent shock of any kind — maybe a confirmation of person-to-person transmission of bird flu, maybe some kind of derivative-related (rogue trader trying to quietly cover losses and failing) panload of stinky-stuff somewhere, you name it — to really give us a SHTF paradigm shift in the market like we saw last week in the gold sector.

Note to all: HB stocks have given up all of their “new home sales better than expected” gains and some are even at new lows for the day. I still say a lot of them could be cut in half from *these* levels before it’s all over.

Comment by LaLawyer
2006-05-24 10:57:00

Bird flu human-to-human transmission reported:

http://tinyurl.com/nnkh3

Comment by Nikki
2006-05-24 13:14:10

Yes, but the real problem will come when it’s not person-to-person bird flu, but person-to-person human/bird hybrid flu…when the genomes combine (the virus has a segmented genome to alloow for various combinations), then we may be in big trouble.

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Comment by Joshua
2006-05-24 13:23:07

Statistically you have a better chance getting hit by lightining than dieing of the bird flu in Asia thus far. We should be giving Tamiflu to the birds because the bird flu certainly has been hurting humans. Heck the regular flu kills more in the US and Asia every year than the bird flu has kill in 5 yrs.

 
Comment by LaLawyer
2006-05-24 13:45:59

Those statistics are meaningless if there is a resulting mutation. Bird-flu (in it’s present state) is difficult to contract, but fairly deadly. If the contraction difficulties change, the entire equation changes. MANY IFS . . .

 
 
 
 
Comment by feepness
2006-05-24 09:28:51

Yes, you’re spot on, bad news has become good news because of the “Greenspan put”. It has been this way for years (decades?) and worked, but I think the punch bowl is about empty and won’t even need to be taken away at this point.

If there was true confidence the Fed would stop raising however, I believe gold wouldn’t be getting the ass-kicking is has been over the last couple weeks. I think we are at the turning point where bad news will start to mean bad news again.

 
Comment by House Inspector Clouseau
2006-05-24 09:47:03

I’m not sure I necessarily agree with all this line of thinking. Here’s my hypothesis:

The markets themselves have many interconnected variables, too complex for our minds to figure out. They thus move up and down, and although there are long term trends than can be PSEUDO-explained, the daily variations are (near) impossible to truly explain in most cases. Hence the “random walk” theory proposed by those like Burton G. Malkiel.

What happens then is that the markets move up or down, and we try to figure out why after the fact, assigning a “cause” to the observed effect. This may or may not be what is occuring at all, but it seems to make sense.

Example:
Scenario 1
Interest rates go up, markets go up. Later we explain this by saying that the markets like when interest rates go up because it means that the economy must be strong, and strong economies are good for earnings, which are good for share prices.

Scenario 2
Interest rates go down, markets go up. In this case we explain by saying that lower interest rates allow for better capital usage by firms, increasing their profits.

Scenario 3
Interest rates go up, markets go down. In this case it is often said that higher interest rates raise the cost of capital and decrease profits, turning the market down

Scenario 4
Interest rates go down, markets go down. Here we explain it by saying that the interest rates went down due to a slower economy which is bad for business, hence markets go down.

The point:
no matter WHAT happens we try to find the “reason” and “cause” for it, regardless if it is the case. Sometimes our reasoning is actually the true explanation, but I think that it often is not.

Again, this pertains to short term market fluctuations, not long term trends.

hence the “random walk” theory… like a drunk who is stumbling home, you know the general direction that he’ll go over time, but can’t quite be sure where each next step will actually take him… lumbering forward, to the left, to the right, falling back a ways, and so on… we can try to explain WHY he stumbled to the left twice, then fell backward once, then forward 4 steps and then back to the right again, but it might not be the true reason

just MO

clouseau

Comment by feepness
2006-05-24 10:24:11

I think clouseau you have explained what the TALKING HEADS will say. If you understand what the zeitgeist of the current attitude is you will have an idea of what the markets will do given a reasonably small set of inputs.

Predicting this is still quite difficult, because there are events beyond fore-knowledge (disasters, scandals) that will still move the markets.

Comment by Getstucco
2006-05-24 12:01:22

disaster => Asian stock market crash to which Wall Street has thus-far seemed relatively immune, and a slow but sure US housing market crash which is clearly underway to those of us who are paying close attention.

scandal => Fannie Mae openly accused of fraud.

So far, US markets have not moved much in response to these recent developments, but markets have a way of correcting to fundamentals over time, as Malkiel’s book attests.

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Comment by Joshua
2006-05-24 14:34:36

Perhaps the markets are at fundamental levels. Again given all the factors discussed in the postings above, some companies are trading at discounts and some are at premiums. Historically the stock market is reasonably priced not too high not too low. This makes traders ruderless. IMHO

 
 
 
Comment by Waiting in SD
2006-05-24 14:16:03

Excellent point, very well said. I was watching one of the UCLA economists that helps put together the Anderson forecast together give a presentation. He said that predicting what the housing market was going to do was impossible, he used the analogy of trying to predict what a crazy person would say next. He predicted flat prices for the next 7-10 years, not sure why though. All of the data presented would indicate a crash.

 
 
 
Comment by Nikki
2006-05-24 06:45:17

Ummmm, the median sales price in March was 224,200 and this month is $238,500…that’s not a 7% drop, I think the AP is wrong. Check here
http://tinyurl.com/s6te9
for a different story not from the AP.

Comment by freeloading roommate
2006-05-24 07:11:23

I agree… I think it was a 7.3% increase.

Comment by freeloading roommate
2006-05-24 07:13:18

Unless the March numbers were revised. But really it’s important not to focus on prices. Current sales and inventory give a better indication of where the market is going.

 
 
Comment by wawawa
2006-05-24 07:33:27

Reuters says :In a further sign the long-anticipated cooling in the housing market has not yet taken hold, April’s median home price rose 2.8 percent from March to $238,500.

 
 
Comment by Larry Littlefield
2006-05-24 06:45:28

Hmmm.

Existing homes, price steady volume tanks.

New homes, volume decent price sinks.

What do the pros know that the amatuers do not?

Comment by Chip
2006-05-24 07:12:11

Like Crispy, I think the “volume” is phony, due to pending cancellations that are not in the number shown as “sold.”

 
 
Comment by need 2 leave ca
2006-05-24 06:46:44

While going through the blog here, had CBS “Early Show” on. They had a rep from “Kiplinger” on there and was talking about the housing market. “KIP” acknowledged the slowdown and that the market has changed from even 3 months ago. Said that people need to price appropriately (lower), change expectations, and to do fix-ups. Even if a potential buyer noticed a small water spot could cause them to walk. If a house sits too long too high, will stay.
WOW, what a difference from the ‘better offer now or it will be gone.

 
Comment by After The Fall
2006-05-24 06:48:39

When prices go down, unit sales go up. What we are seeing is a multitude of conflicting statistics as the real estate juggernaut steadily grinds from the fairy tale market of last year to the nightmare of next year. On this blog we are a fairly heterogeneous group so we are frequently failing to recognize that our forecasts are ahead of the market, not concurrent with it. In many places huge rises in inventory came off record low inventory levels, so prices are flattening more than falling.

The key is the trend. Realtors see the glass as half full, we see it as half empty. The truth is, it really is half empty because it used be be full.

We are very, very, very early in this crash. Things will continue to worsen at this pace for years.

Comment by Chip
2006-05-24 07:14:04

“Realtors see the glass as half full, we see it as half empty. The truth is, it really is half empty because it used be be full.”

I like the way you put that.

 
Comment by Ted
2006-05-24 08:31:43

Realtors see the glass as 1/10th full, we see it as 9/10th empty

 
Comment by KennyBabes
2006-05-24 08:56:40

Reminds me of Steven Colbert at the White house Correspondents dinner.

“Now, I know there are some polls out there saying this man has a 32% approval rating. But guys like us, we don’t pay attention to the polls. We know that polls are just a collection of statistics that reflect what people are thinking in “reality.” And reality has a well-known liberal bias.”

“So, Mr. President, please… pay no attention to the people who say the glass is half empty, because 32% means it’s two-thirds empty. There’s still some liquid in that glass is my point. But I wouldn’t drink it. The last third is usually backwash.”

 
 
Comment by arlingtonva
2006-05-24 06:48:49

Sales of new homes rose unexpectedly in April to the fastest pace this year as the housing sector showed resilience in the face of rising mortgage rates. But the price of homes sold last month fell and the level of unsold homes rose to a record high

Prices are down and inventory is at record highs and yet this journalist chose the title for this article “Sales of New Homes Jump Unexpectedly”.
If that’s not spin, I don’t know what is.

 
Comment by Nikki
2006-05-24 06:50:50

But did you see the March sale snumbers were, of course, revised downward…but this isn’t all bad. Let BB jack up that FF rate…there’s no reason not to anymore…housing is OK, everyone move along, nothing to see here…but who ARE these greater fools? I guess they don’t read these blogs, that ’s for sure. But I’d like to know where the hell you can buy a new home for less than $238K…

Comment by Getstucco
2006-05-24 06:54:17

That median new home sales price figure must include mobile homes…

Comment by Mort
2006-05-24 10:14:27

A good mobile home costs 20k. A decent prefab less than 50k. The only reason prices are so high in bubble-land is because Californians et al are high on OPM. If lenders quit lending huge $$ at impossible terms for overpriced POS(s) to unqualified buyers then we would quickly see how much houses were “worth”. We are all going to suffer due to this madness.

 
 
Comment by dannll
2006-05-24 07:09:00

Huntington WV…My wife’s aunt has a 3 story 80 yr old house that is appraised at $68k…

 
Comment by Hannah Montana
2006-05-24 07:12:07

I also wanted to know who these greater fools are. So I looked up the data (all public information via the Registry of Deeds) for three houses in my area which were bought recently. All three have first mortgages in excess of 900K. You guess it. They are option ARM’s. What are these people thinking?

Comment by oc-ed
2006-05-24 19:34:33

They are not thinking, that is the problem.

 
 
Comment by Chip
2006-05-24 07:21:14

All over the U.S. of A. But … you have to decide what you are willing to trade for that price — or any price at any given time. Pick two of three: Size, Quality, Location. At any kind of price most of would be looking at today, you don’t get to choose all three. Wait a few years and that could change a lot.

 
Comment by cabinbound
2006-05-24 07:51:19

Nikki you are correct economically — interest rates should be higher to fight inflation which is really about 7-8% not the 2-3 or even 5% we see in the “official” numbers.

However, I believe Bernanke will NOT raise rates again at the end of June for political reasons, i.e., his own legacy. The housing market will continue to collapse under its own weight whether he raises or not; if he raises again many would point to him as the very cause of the “Summer Slump Of 2007 — When The Housing Market Crashed”.

Comment by Getstucco
2006-05-24 08:43:09

cabinbound,

What kind of legacy do you imagine he is pursuing: “New Fed chief earns Helicopter Ben label by spiking the punchbowl in response to Wall Street criticism?”

G. William Miller spiked the punchbowl in the late 1970s and was replaced by staunch Republican Paul Volcker on Jimmy Carter’s beat (an amazing fact in-and-of-itself!). Who has the more favorable legacy — Volcker (who did not hesitate to protect the dollar instead of further spiking) or Miller?

Central bankers have to live with the tendency of the untutored masses to misunderstand lag effects. The housing market crash is already underway, and monetary policy operates with at least a 9-18 month lag, so nothing BB does this summer can stop this avalanche in progress.

 
 
Comment by Mort
2006-05-24 09:33:34

You’re kidding, right??

 
 
Comment by Judicious1
2006-05-24 06:52:28

I wouldn’t attemp to predict where the market is headed by looking at new home sales for a month. Economists that make statements based on this data “can’t see the forest for the trees”, IMO. I think data such as inventory levels, prices and foreclosure rates over a 6 or 12 month period are much better indicators of where the market is headed.

Comment by Ben Jones
2006-05-24 07:03:23

‘Sales increased to an annual rate of 1.198 million. Builders broke ground on at an annual rate of 1.849 million, the Commerce Department said last week.’

The government says between 300-400k houses become obsolete each year. That still leaves hundreds of thousands more built than sold. Also, much of what is being built is too expensive for median affordability.

March inventory..552,000
April inventory…565,000

Comment by Moopheus
2006-05-24 07:15:41

What makes a house “obsolete”? does that mean physically destroyed? Or otherwise uninhabitable? Or do they just need an “upgrade”?

 
 
 
Comment by Chad Day
2006-05-24 06:53:51

This report is going to encourage sellers to continue playing hardball.

Comment by Ben Jones
2006-05-24 07:14:48

And the Fed too?

Comment by Pasadena Renter
2006-05-24 07:35:50

I agree. This should be another excuse for the Fed not to stop in June. I do not see how they can stop in June with the last cpi, together with news like this. Like russwinter points out, everybody now is well aware of the Fed’s bluffing. It is time to shock the markets, they should increase by 0.5 in June. Otherwise BB is going to get getstucco’s many times mentioned chest tatoo

Comment by Getstucco
2006-05-24 07:43:02

The Maria Bartiromo flap has made BB appear weak, perversely upping the ante for him to prove that he will not be cowed into spiking the punch bowl by the Wall Street revelers. And the strong new home sales report makes it difficult for the Fed to assert that the market is slowing, justifying a pause. It adds up to quite a conundrum, neh?

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Comment by cabinbound
2006-05-24 07:59:42

Ben, apologies if this has been covered before, I haven’t checked the blog in a while…been reading some stuff here and there — as interest rates rise and reduce the numbers of people buying homes, more people rent, rent prices stop dropping, firm up, or even rise, “rent and rental equivalent” part of CPI goes up, CNBC pounds table at shocking increase in inflation, Fed is pressured to raise interest rates…now go back to step 1 and repeat!

Comment by Chip
2006-05-24 08:39:05

Cabin - don’t know about your area, but rents here in my part of Central Florida are holding steady or edging down. Definitely not going up. More flippers, who are foolish enough to think they can wait another year or two to “get their price,” are putting their properties up for rent, putting downward pressure on prices. A place I looked at for $2,500/mo. a year ago is now listed for $2,00/mo.

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Comment by Chip
2006-05-24 08:39:52

$2,000/mo.

 
Comment by cabinbound
2006-05-24 15:11:36

It’s not anectodal — this is actual data in the CPI numbers from last week. A marked increase in the so-called “rent and rental equivalent” which is a significant portion (30%?) of the CPI.

 
 
Comment by Renting in SOFLA
2006-05-24 09:00:21

Rents are going down in SOFLA and Boston, the two areas that I am familiar with, lots to choose from!

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Comment by The_lingus
2006-05-24 08:53:17

Comment by Ben Jones
2006-05-24 07:14:48
And the Fed too?
________________________________________________

Bingo. It seems everything that gets reported gets spun in a way as a means to justify another rate increase. It all seems a bit too contrived. Yeah, when a market shifts the data gets noisy but the spin put on the reporting of that data appears to be the goal.

 
 
Comment by Neil
2006-05-24 08:13:15

I hope so. Why? There just aren’t many people left who can afford homes. While I feel for the families who buy in now (or are locked out), this news will drive more speculators back into the market. Thus increasing the inventory overhang. This expidites the return to sane prices. Soon… so soon!

I’m predicting a pretty wicked “dead cat bounce.” What we’ve seen? That isn’t a bounce. Wait until the fall when people really *need* to clear inventory. Of course I could be wrong… Make no investment decisions based on my comments. But I think I’m on the money. ;)

I just told a realtor who was pestering me that compared to rent, purchase prices make no sense. Sadly, I missed the facial expression as this wasn’t face to face. Cest la vie.

Neil

Comment by Ted
2006-05-24 08:32:35

This is the bounce. The top was in July/Aug 2005

 
 
 
Comment by Getstucco
2006-05-24 06:58:53

The biggest statistical lie may be the incentives that are currently being used to the growing pile of new home inventory. If incentives valued at $50K-$100K are not subtracted off the sale price, then the sales price could look a lot higher than the actual value of the deal to the buyer.

For that matter, the $238K figure looks suspicious in and of itself, as half of all new homes sell below the median by definition. How many Toll Brothers homes sell below, or anywhere near, $238K?

Comment by wawawa
2006-05-24 08:05:15

Good point.

 
Comment by Mort
2006-05-24 09:44:39

Toll brothers ain’t king of the world ya know… Take a look around. When I hear that number is 238k I immediately gag at how high it is. Gadzooks! Has the world gone mad?

 
Comment by cabinbound
2006-05-24 15:23:33

Tomorrow’s existing home sales numbers could tell the tale. No incentives to artificially keep the prices up, and a very real possibility that they are year-over-year negative from twelve months ago.

They squeezed HB shorts yesterday on Fed hand-wringing about slowing sales and then squeezed them again today on the report of rising sales, so you know that at least one of those reactions was a scam. (As I posted earlier, today’s euphoria didn’t last long. It is also clear that the rise in HB’s from mid-day on was in the backdraft of obvious PPT action.)

The stage is set for some real selling tomorrow if that median is YoY negative — it would be the first time ever.

 
 
Comment by novarenter
2006-05-24 07:00:15

Apparently, the margin of error on the new home sales number is 11.5%:

Up 4.9% +/- 11.5%

Comment by shel
2006-05-24 07:52:15

you’re kidding! Funny, I don’t even think about margin of error with stats like sales increases. I guess I assume it is a pop. value, that economists reporting this stuff have access to the entire and relatively reliable database of transactions…not that it is a ’sampling’ survey, with a margin of error based on that? Never really thought about it, but indeed perhaps a cultural difference between economists and political scientists for instance…e.g., the consumer confidence index ups and downs never get reported with margins of error (not in at all a widespread way anyhow), while political polls always include that +/- number…

Comment by shel
2006-05-24 08:13:42

oops…my bad…the margin of error is due to “seasonal adjustment” error-terms? I have no clue how they work out seasonal adjustment error-terms, but reading Robert Cote’s deeper (heck, I only look at third-hand sources most of the time!) analysis made me realize this was crap post..
I wish there was an edit feature!

 
 
Comment by Chip
2006-05-24 08:42:29

I wonder what a margin of error percentage has to be, to be equal to just a wild-ass guess?

 
 
Comment by Getstucco
2006-05-24 07:05:00

Builder stocks seemed to rally on the new homes report, but on closer inspection, it looks like the broad market (e.g. DJIA) is the dog and the HB stocks are the tail…

Also, goldbugs, keep your eye on that price crash underway (down $30 already this morning).

http://tinyurl.com/qp6bz

Comment by Getstucco
2006-05-24 08:47:22

Red (number) alert again on marketwatch.com:

http://www.marketwatch.com/tools/marketsummary/default.asp?siteid=mktw

 
Comment by Getstucco
2006-05-24 10:09:17

Don’t look now, but the DJIA is drooping dangerously near the psychologically-important 11K level. Look for PPT intervention to lift it up like a finger off a hot stove if it gets much closer…

Comment by cabinbound
2006-05-24 15:29:47

Yep you called it. Funny how CBS Marketwatch et al always talk about “investor uncertainty leading to wild swings” on days like this.

One would expect that “investor uncertainty” would manifest itself as a more or less horizontal line throughout the day intead of every stock on the board going up a percent and more at exactly the same time not once but three times — almost exactly at the bottom of every hour, starting at 1:30.

 
 
 
Comment by DinOR
2006-05-24 07:05:37

David Seiders (NAHB) interviewed on Bloomberg’s said: “Anyone looking at April’s sales numbers and saying this indicates a recovery in the housing market “should be LOCKED UP!” He still sees the over all trend as downward. The quote is done from memory and are not MR. Seiders exact words.

Comment by Nikki
2006-05-24 07:10:42

That would be him trying to save his and every other HB’s ass by talking it down so the Fed will think housing is cooling in deed…not saying that he’s not correct, because I agree with him, but, if as another poster above said, this encourages sellers to play hardball, then they can look at LT rates and cry…and pray.

Comment by DinOR
2006-05-24 07:17:58

Nikki,
As I listened to the interview w/Mr. Seiders there was a definite tone of complete candor. He wasn’t cheerleading for investors to buy homebuilder stocks (or homes for that matter) and really came right out and said that he felt there was much peril ahead. Was this an open plea to BB to cut rates? Doubt it. He seemed to portray the HM as one that neede to run it’s natural course and implied that builder incentives were very much “part and parcel” with the end of a boom and the start of a major correction. Any internet savvy folks out there that can post the transcript? Hell, I’m ready to give this guy a “jersey”! David, you’ve made the team!

 
 
 
Comment by lainvestorgirl
2006-05-24 07:08:59

How can there be record sales AND record inventory? There must be a whole lot of overbuilding. Thought the builders promised they wouldn’t do that “this time”, because now they only build upon taking orders from buyers?

Comment by Ted
2006-05-24 08:34:19

Say’s Law

 
 
Comment by AmazingRuss
2006-05-24 07:11:22

That means it COULD be up 16.4%! We’re saved!

 
Comment by crispy&cole
2006-05-24 07:13:04

HEADLINE SHOULD READ -

YOY HOMES SALES DOWN 5.7%.

Read the entire report!

Comment by crispy&cole
2006-05-24 07:13:35

Headline spin by the NAHB and MSM is giving me a headache!

 
Comment by crispy&cole
2006-05-24 07:17:09

Also, YOY sales DECLINED 33.3% in the NE US.

 
Comment by crispy&cole
2006-05-24 07:18:14

Months supply up 34.9% YOY!

 
Comment by crispy&cole
2006-05-24 07:21:32

Throw in the cancellations NOT COUNTED and this report is a MAYDAY call from the Titanic!

Sorry for the rant… back to our regularly scheduled program…

 
Comment by DinOR
2006-05-24 07:23:05

crispy&cole,
Much thanks! You said someone would “punch holes” in this thing so it’s only right and proper it be you. I think a “victory lap” is in order! Mr. Seiders comments reflected the “bigger picture” and I think Suze Assad (Bloomberg’s) actually had to cut the guy some slack vice “going after him” like she typically does with housing bulls! She did stop short though of applauding her guest for sharing the bigger picture.

 
 
Comment by Chip
2006-05-24 07:23:57

I think that if the reports were titled fairly, for this decade, at least, they would be called “Used Home Sales” and “New Home Sorta’ Sales.”

 
Comment by hd74man
2006-05-24 07:26:56

The drinking of the home-ownership “KOOL-AID” continues…

http://www.breitbart.com/news/2006/05/24/D8HQ6HK80.html

hehehe…notice the no parking banner on the condo frame.

Fools and their money are soon parted.

 
Comment by Robert Cote
2006-05-24 07:29:41

This is all housing math. This will take a bit so be patient with me:
Sales of new one-family houses in April 2006 were at a seasonally adjusted annual rate of 1,198,000, according
to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban
Development. This is 4.9 percent (±11.5%)* above the revised March rate of 1,142,000,

But at the bottom of the page they also write:
Seasonally adjusted estimates for January 2004 through March 2006 have been revised. [emphasis added]

So, what was the “revision?” Last moth it read:

“New Home Sales in March were at a seasonally adjusted annual rate of 1.213 million.”

EVERY revision for the past 6 months has been downward. Indeed this month they went back to January to adjust downward a 3rd time.

So, where did you ever see 1.213 million March number? Not just in this report, it’s gone, never existed. Duobleplusgood newspeak. The b@astr@ds have actually tried to go back and edit the past so that this months LOWER sales are reported as higher. I’ve been looking at the reporting and no one has mentioned this. All it takes for evil to triumph…

Comment by crispy&cole
2006-05-24 07:36:06

This is bordering on down right Enron-esque!

Comment by Upstater
2006-05-24 07:47:48

1984

 
 
Comment by Chip
2006-05-24 07:40:53

Robert - wish you could get this onto national TV.

Comment by arlingtonva
2006-05-24 07:46:55

I’m looking forward to video blogs…with highlights of the day ;)

 
Comment by Robert Cote
2006-05-24 07:49:08

Took me 5 minutes. Whatintheheck is wrong with a nation that cannot do its own math? At some point I realized that you cannot teach people to fish until you first stop giving them fish. I imaging Barry R. will jump all over this on Kudlow & Company or something similar. The whole business of NAR estimated seasonally adjusted has been discussed to death as well. Joke; two finalists for CFO being interviewed by the CEO & Board. “So, how much is 2+2?” First guy answers “Before taxes, 4.” Second one replies; “How much do you want it to be?” Guess which one works for the NAR?

Comment by Sunsetbeachguy
2006-05-24 08:00:07

People are bad at math.

If we tell them housing is going up they will assume it must be.

1984 just 22 years later.

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Comment by shel
2006-05-24 08:19:52

I’m so confused…I don’t mean to continue a discussed-to-death-topic, but how do they work out their ’seasonal adjustment’ ? I know, I know, I’m being a lazy American and could just try and google it, but since I’m here already :-)

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Comment by Getstucco
2006-05-24 08:44:36

Crooks can steal more easily if their victims are innumerate.

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Comment by chris Jacksonville FL
2006-05-24 08:01:29

You are exactly right my friend! The ability to revise past data downwardly to make current data look good is truly remarkable and misleading.

What’s more is the headlines are always surprisingly bright and shinny. Don’t worry home buyers. There is no possibility of a housing bubble. Sales percentages are always increasing. Don’t look at the raw data.

Reminds me of FNM and Enron. Three months from now they will revise last months raw data downward 5% and claim sales increased from the lowered level. What a mess!

 
Comment by wawawa
2006-05-24 08:14:37

This is a deliberate manipulation of data. Some people have no shame.

I am coming to conclusion that “Real Estate” as a whole is not an honorable profession.

Comment by Gravity 'ON'
2006-05-24 09:44:57

I read a lot of understatements on this blog, and this is one of them.

Realtors fell below car salesmen in the integrity rankings a long while ago in my book.

 
Comment by Doc
2006-05-24 09:49:36

I’ve been following VA housing sales stats and have seen this kind of manipulation repeatedly - and not just on previous month stats, but on previous year stats. When reporting sales for any given month in year X their press release cites sales in same month year X-1 and the number is often entirely different (sales, median, whatever) from what was reported in year X-1. And, nowhere else is the corrected number given - not until a full12 months later, and even then only to justify a “gain” over last year that often was really a loss in volume or sales median price. It stinks. I emailed cnn money about this a few months ago but nobody seemed interested.

 
 
 
Comment by salinasron
2006-05-24 07:29:51

Today from the SFC newspaper:
“The Hercules City Council voted unanimously Tuesday night to take the unprecedented step of using eminent domain to prevent Wal-Mart from building a big-box store on a 17-acre lot near the city’s waterfront.

The vote caused most of the 300 people who had packed Hercules City Hall for the meeting to break out in cheers and applause.

“The city of Hercules is very unique. People from the outside have to understand that,” said Hercules Vice Mayor Ed Balico just before the vote.

During a 90-minute public comment period that preceded the vote, nearly everyone who spoke urged the council to fight Wal-Mart.

“Throw the bums out,” Hercules resident Steve Kirby said at the podium of Wal-Mart. “Wal-Mart will never understand what we want.”

Another resident, Anita Roger-Fields, expressed concern for small businesses in the city, saying they could be driven out of business by the discount store. “(Wal-Mart is) the worst thing that could happen to our community. They want to crush the competition.”

So when do activist communities decide to seize your condo and turn it into low income housing for the poor. Once you open the flood gate door you can’t stop the direction of the flood waters.

Comment by Northern VA
2006-05-24 08:18:49

I am against using eminent domain for something other than a public good, ie highway, school etc. This is a clear violation of the 5th amendment and our supreme court should be ashamed of setting this precedent.

However, communites can and should be able to control future development through zoning that can control what is built where, right down to specifying the maximum square footage of a retail establishment. If they want their city’s waterfront to be parkland, condos, mixed used planned communities, etc. they need to specify that with zoning. I don’t see how siezing private property is the solution to this case.

 
Comment by Betamax
2006-05-24 10:40:17

Once you open the flood gate door you can’t stop the direction of the flood waters.

Your tinfoil hat is askew.

 
 
Comment by pvb
2006-05-24 07:33:26

OT, but have a look at what someone did to this property (apparently once a nice house). This is out of the thread of this discussion, but what the heck.

http://orangecounty.craigslist.org/rfs/164100634.html

Comment by Former Saratoga CA homeowner
2006-05-24 07:48:47

That addition is hideous.

 
Comment by NoVa Sideliner
2006-05-24 07:53:14

They gotta be kidding! “Over three thousand sq. feet and more if you include the attics ” Include the attics?!? WTF?? And a lovely little hint that “Nearly half has been remodeled and restored”, meaning the other half looks like an abandoned crackhouse inside? Who knows.

Nice grass color, too, despite the sloppy job they did painting it on with PhotoShop. I wish I could get my grass to look like that. Maybe I need some better software.

And I’m still trying to figure out where the “Victorian” comes into that ugly, stuck-together house. Maybe the guy who owns it is just named Victor.

Comment by novarenter
2006-05-24 07:56:55

Is it me or does the car look photoshop’d too?

Comment by cabinbound
2006-05-24 08:11:16

LOL yeah the lighting is all wrong, plus would he just park it on that astroturf too?

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Comment by Karen
2006-05-24 08:23:38

The whole thing looks fake to me.

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Comment by devo
2006-05-24 13:41:06

and the palm trees

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Comment by shel
2006-05-24 08:27:46

don’t laugh about including attics in SF…hubby tried to convince me to buy a house claiming that if you include the attic there was enough space. Our realtor had said during the showing that the place where you could ‘add value’ to this house was finishing the walk-up attic. I’m sure she’d researched it!

 
 
Comment by Chip
2006-05-24 08:53:30

It’s a Georgian abstraction of a McTorian.

 
 
Comment by buffpilot
2006-05-24 07:34:35

A housing bubble discussion is just getting started (focusing on Boston) at: http://www.janegalt.net/

I like the site and they have some interesting, thoughtful discussions. (and its not my site - heck I can’t even accomplish a tiny url :))

Comment by Ted
2006-05-24 08:35:45

Sorry I had to stop reading when I saw “Incomes are increasing”

Comment by The_lingus
2006-05-24 09:05:26

Comment by Ted
2006-05-24 08:35:45
Sorry I had to stop reading when I saw “Incomes are increasing”
_________________________________________________________
[laughing] The Bush administration pushed Treas. Sec. Snow out in front of the camera last week to “sell the american people” the idea the economy is doing good. He came out and said “wages are up 4% for the worker”, the interviewer asked where wages were when adjusted for inflation (which are way down), Snow began to $hit all over himself trying to find a way to cover up the ugly truth…..

It was enjoyable to watch and typical of the “new” USA we now live in.

Comment by feepness
2006-05-24 09:42:36

It was enjoyable to watch and typical of the “new” USA we now live in.

I really liked the “old” USA better where:

1. We knew what the definition of “is” was.
2. We could just read the President’s lips to know we wouldn’t have any new taxes.
3. We sold weapons to terrorists to get money to give to anti-communists to buy weapons.
4. We could solve energy crises just by wearing sweaters.
5. Parties didn’t break into hotels to steal secrets from each other.
6. We didn’t get involved in land wars in Asia.
7. Bullets fired from book depositories could magically turn at right angles.

Sorry to feed the lingus but this was too funny.

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Comment by The_lingus
2006-05-24 11:04:39

Desperately clinging to a sinking ship is unbecoming. Really…. Please try a little harder next time.

 
Comment by feepness
2006-05-24 13:36:26

Not sure which ship you think I’m clinging to. My point is they all look pretty much the same to me.

 
 
 
 
 
Comment by shel
2006-05-24 07:36:48

ooh, somehow I’m reminded right this second that I thought I saw a blurb on last night’s “NBC Nightly News with Brian Williams” (I never watch network news anymore, but I tuned in last night to catch Bono ;-) in Africa talking up economic development and aid there…) advertising that tonight there would be a story called something like “Sitting on a House Bubble?”…I may have imagined it…but hey if “buy or sell?” was on the cover of Parade mag last weekend, I might not have.

 
Comment by KirkH
2006-05-24 07:43:45

If April was the dead cat bounce last week left no doubt that the cat is dead.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity for the week ended May 19 decreased 6.0 percent to 552.6 from the previous week’s 588.0.

The MBA’s seasonally adjusted purchase mortgage index fell 7.1 percent to 396.4. The index was also below its year-ago level of 482.3.

The purchase index is considered a timely gauge on U.S. home sale

6% drop in demand for houses in one week. I wonder if its just a statistical anomaly.

 
Comment by salinasron
2006-05-24 07:44:18

Ben wrote “The government says between 300-400k houses become obsolete each year.”

I guess that’s true if we have enough Katrinas, Wilmas, numerous tornadoes, fires, arson, floods, etc. each year……

Comment by feepness
2006-05-24 09:33:37

Now I know why Bush REALLY bombed the levvies.

 
 
Comment by crispy&cole
2006-05-24 07:50:42

One more post on this -
YTD Sales are DOWN 11.26% YOY.

MSM - READ THE REPORT!!

 
Comment by Portland Mainer
2006-05-24 08:05:59

Builders first cut prices so as not to get stuck with inventory when the market really cools.But then, being more attuned to the new softened conditions than individuals selling their own homes, they reduce prices going forward as well. They can do this as they are still making a huge profit.

The result is that while there may be overall lower demand for homes, there’s greater demand for new homes because their price relationship to existing homes just became a lot more favorable to buyers. Eventually, the individual homesellers will have to stop being stubborn and lower their prices.

Builders are thus a major problem for individuals trying to sell at last year’s prices.

That’s how I see it anyway.

Comment by Neil
2006-05-24 08:44:54

Good points.

1) People like to buy new. (No one died in the house, new house smell, whatever)

2) The builders can cut an amazing amount and still end up in the black.

Your points are very valid.

Neil

Comment by novarenter
2006-05-24 09:05:48

There seems to be a common belief that a “new house” is going to have fewer problems than an “old house”. I know a few people going through the 30-year maintenance cycle on homes (replacing the furnace, deck, etc.) and they all vow that when they move they’re buying a house

 
 
 
Comment by Waiting in Vegas
2006-05-24 08:34:35

“The housing market is not cooling as much as Fed officials were anticipating,” Chris Rupkey, senior financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York, said before the report.
Bloomberg http://tinyurl.com/gyttb

IMO, feds fudge numbers up to help give an excuse to keep raising rates.

 
Comment by jim A
2006-05-24 08:38:36

It’s all about the inventory, stupid. Back when there was no inventory to speak of, say the ‘03-’04 timeframe people in the market to buy a house would have the repeated experience of having houses that they looked at go under contract before they could decide to buy or not. Low inventories create a “buy now or it’s gone” frenzied atmosphere.

But prices have risen far above the cost of construction, so that builders have put huge inventories of new homes (especially condos)on the market. With these large inventories, buyers don’t have to jump immediately just because a nice house is for sale. They can take their time, if one house sells, there are plenty of others on the market to choose from. They’re no longer pressured to meet the sellers price immediately or lose the chance at the house. They can offer less and see how desparate the seller is. This is why the idea that we have reached a new plateau of prices where forever in the future people will pay a higher percentage of their income on housing is so absurd.

 
Comment by arlingtonva
2006-05-24 08:53:38

With cheery headlines, sellers are not going to want to lower prices, leaving Realtors with no income.

Comment by Chip
2006-05-24 10:01:26

“With cheery headlines, sellers are not going to want to lower prices…”

…assuming they don’t follow the inventory numbers much. They never *want* to, but those who need to sell, will and at that lower price.

Comment by Waiting in SD
2006-05-24 14:29:01

Don’t really need to look at inventory numbers, all you have to do is drive around on Sunday and look at all the open house signs IMHO.

 
 
 
Comment by tommy_trojan
2006-05-24 09:03:50

Things are looking very tremulous around the globe, especially in emerging markets, Wall Street is not acting well either. Not a good time to be so leveraged, exposed, and paralyzed in RE. I have no data to back it up, but the mood around the world is pretty intense right now. It feels like somebody is in trouble. No data to back up my claim just gut feeling from years of trading. It feels like 1987 over again, except more debt, leverage, and hedge funds this time around.

Comment by wawawa
2006-05-24 09:13:16

I totally agree, something is wierd. I do not remeber anytime during last 5 year where DOW was down seven I sold all of my stocks last week.

stay safe, stay liquide

Comment by wawawa
2006-05-24 09:19:15

I meant “seven consequitive days”

 
 
Comment by Bubble Butt
2006-05-24 09:17:58

I get that same uneasy feeling. The overall attitude of the market seems off. Were rallying in the AM and selling off. Commodities down. Bonds yields seesawing. No real direction or leadership in most of the groups. Lots of bad news. Even IPOs are now showing weakness, ie today’s Vonage IPO is a complete wipeout.

Oh, by the way. FIGHT ON!!

Comment by feepness
2006-05-24 10:07:08

I think today’s Vonage IPO is quite telling as a lack of liquidity. The crunch may be starting.

Comment by garcap
2006-05-24 10:18:02

Plus, Vonage is a joke. It’ll be out of business in five years.

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Comment by feepness
2006-05-24 10:20:12

Why is it a joke? I use SunRocket Voip and actually have put a couple family members on it… it’s great. Serious question, I just don’t know about Vonage.

 
Comment by santacruzsux
2006-05-24 10:38:02

I have a buddy that has the vonage phone. I have to say that it sounds like I’m talking to a guy on a cell phone in a tunnel.

 
Comment by feepness
2006-05-24 13:35:02

Hmmm, no complaints about SunRocket from either my non-technie wife or non-techie Mom. Cheap, good voice quality, it’s BEHIND my router, and hooked invisibly into the main house wiring. Not to mention an incredibly convenient set of web-based management tools. I also have my router/phone box on a

 
Comment by feepness
2006-05-24 13:45:57

…?

on an inexpensive battery backup.

I can recommed it highly if you are comfortable with that sort of thing.

 
Comment by garcap
2006-05-24 16:36:07

Sunrocket sounds like a much better product. I have vonage and it’s pretty bad: cuts out occasionally, voice quality is spotty, and it’s not cheap. Comcast waited a while before rolling out VoIP and apparently has a muych better product as do many of the other cable providers. I’m not sure how vonage competes when all the national cable cos. bundle it with other services

 
 
 
 
Comment by feepness
2006-05-24 09:30:33

Also we have had a lot of these last trading hour plunges. It seems that people are nervous and want to sleep on their daily gains.

 
 
Comment by Gravity 'ON'
2006-05-24 10:09:11

Well, I guess someone ain’t buying this “surprising rise in home sales” good news. The homebuilder stocks are in the red right now.

Funny, the rising sales news is all over the radio this morning, but where is all the bad news about the huge bulging inventories? Mainstream media is virtually silent on this.

I mention to people, for example, that San Diego inventory is now over 20,000 while less than 5,000 last year, or PHX is over 45,000 while less than 12,000 last year. They look at me shocked like this is the first they’ve heard.

Mainstream media is as deep as infestors go to get information, and now they think everything is still moving along just swell after hearing today’s headlines.

Comment by david cee
2006-05-24 21:09:02

“Mainstream media is as deep as infestors go to get information” and where is the “NO SPINMEISTER” Oreilly with the bubble story. Very, very quiet on the Fair and Balanced station about the bubble. Ben would be a good interview for this non-mainstream media.

 
 
Comment by tommy_trojan
2006-05-24 10:11:10

This latest Avian Flu news from Indonesia may pick up momentum in the coming days. If human-to-human transfer is confirmed as the cause of death in that family of six, it will induce major dislocation in markets around the world.

Comment by Betamax
2006-05-24 10:47:56

Don’t count your chicken littles before they hatch. Posts like these merely support the generalizations made by trolls: that bubble watchers are a fundamentalist ‘gloom & doomers’, waiting for the apocalypse. Please start your own end-of-the-world blog elsewhere.

 
 
Comment by tommy_trojan
2006-05-24 11:22:59

It’s definitely not the end of the world, far from it. It’s just the beginning of excrutiating carnage for many RE agents/speculators. There will be better days ahead for this country once we get sober from this debt bubble and RE mania. The sooner we clean up this overextended distortion in capital flow, the sooner we are on track for real prosperity.

 
Comment by ck986
2006-05-24 11:39:52

Didnt anyone notice the declining YOY numbers? The NE showed a 33% declin YOY. Last year they were touting YOY numbers this year its month over month. To me it seems like lets just report positive numbers, forget reality. This is the seasonally busier part of the year, what do people expect. Non adjusted YTD sales are down by about 10%. Oh well if the Fed buys into it they will just continue to raise rates wich will make it even worse for the market.

 
2006-05-24 19:15:49

Orange County, SoCal Inventory has now officially more than doubled!! Starting to see some price cuts even in Irvine on ziprealty.

http://bubbletracking.blogspot.com/2006/05/tracking-orange-county.html

 
Comment by Baldy
2006-05-25 13:10:19

I take it from the quote about what the Fed’s having expected a worse decline in the housing market, that (if account is accurate) they will continue to raise. I will be shocked if the Fed Funds rate doesn’t hit 6% this year.

 
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