‘Homebuyers Awaiting A Price Plummet’
A pair of reports from the north-eastern US. Connecticut, “Facing tougher competition, Greater Hartford homeowners hoping to sell their property may have to consider lowering their asking prices as the number of homes on the market increased for the ninth month in a row.”
“The Greater Hartford Association of Realtors reported that the number of single-family homes on the market in its 57-town area rose to 5,296 in May from 4,011 in the same month a year earlier, a 32 percent increase. ‘We haven’t seen that number of houses on the market since the late ’90s, so this is a big number,’ said Ronald F. Van Winkle, a West Hartford economist.”
“The inventory continues to inch closer to that of the mid-1990s, when the number in Greater Hartford grew to more than 6,000 as the market struggled to pull through a housing collapse.”
“Real estate agents said sellers may have to lower their expectations about what their home may sell for, and buyers are starting to gain a bit more leverage in negotiations. ‘If a home is on the market and has several showings, and nobody’s making an offer..then the reality is they are going to have to look at the pricing on it,’ said (realtor) Cile Decker in South Windsor. ‘The sellers have to face that reality at some point, and perhaps lower the price.’”
“New listings increased about 12.3 percent from April to May. Van Winkle said the jump could mean that sellers are beginning to anticipate the slowing market.”
“‘I guess if you’re thinking about selling your house in the next year, you’re thinking, `Let’s get our house on the market before it slows more.’ That’s part of what’s causing the inventory to go up,’ he said. ‘If you’re thinking about retiring or considering selling your house, this might be a good time because we are nearing the peak of the housing market in Connecticut.’”
The Long Island Business News. “Buyers and sellers appear to be in a standoff, according to the latest numbers provided by the MLS of Long Island. Homebuyers are awaiting a price plummet, and now sellers, too, are holding off, many demanding the selling prices everyone recently bragged about.”
“The rapid ascent of housing prices appears to be over, at least for now, and while both sides wait for the other to budge, Islandwide inventory is rising. Regional housing inventory spiked more than 50 percent in the last year.”
“May’s residential inventory soared to 27,174 regionally, up almost 52 percent from a year ago. Suffolk buyers can pick from 11,817 available residences, up 50 percent from the 7,862 available a year ago. Nassau, meanwhile, has 8,351 available, a 57-percent rise.”
“(Broker) Mark Malsky says business is picking up. ‘I’m not going to say it’s anything like last year, but it appears to be moving in the right direction,’ Malsky said.”
“Another agent disagreed. ‘This is supposed to be the busiest time of the year and it’s real, real quiet,’ said Bart Bleiweiss, an associate broker. ‘Buyers are real slow pulling the trigger.’”
‘price plummet’
Looks like the media is realizing buyers aren’t waiting for a 5% reduction in prices.
The media’s bubble lexicon is becoming a bit more colorful.
“(Broker) Mark Malsky says business is picking up. ‘I’m not going to say it’s anything like last year, but it appears to be moving in the right direction,’ Malsky said.”
“Another agent disagreed. ‘This is supposed to be the busiest time of the year and it’s real, real quiet,’ said Bart Bleiweiss, an associate broker. ‘Buyers are real slow pulling the trigger.’”
____________________________________________
So who is telling the truth???
‘Buyers are real slow pulling the trigger.’
This is in reference to suicide loans.
Let see - suicide loans and pulling the trigger. I wonder what these two have in common…
Buyers are not waiting to see if prices will come down. They are waiting because they cannot afford a home at the current price levels. If realtors think this is a match stand off then they are very confused. Realtors actually think people can afford these homes. Realtors will be waiting a long time.
Buyers are not waiting to see if prices will come down. They are waiting because they cannot afford a home at the current price levels.
The absolute crux of the problem. With a 50% divorce rate in this country, it’s totally beyond me whose snappin’ up all the $400k condo’s and $800k single-families.
What’s the median income split 50% in this country?
$27.5k????
That used to get ya a single-wide mobile home on 10 acres up in the Maine sticks.
Now it get’s you a tent platform on a half acre of cut over swamp.
This is exactly my problem with this whole mess. I’ve stated before that, with prices as they are, real estate has become a prize reserved only for married folk.
I agree. The only buyers left purchasing are either uninformed and “buying” into the realtors scare tactics, or simply have sold and are moving up and planning on staying in that house a long time. I forgot to add those who are so disgustingly wealthy that money is no object period. Everyday working people are close to priced out in virtually every market in the US. The idea that the prices are sustainable is laughable. When did economists, realtors, and the like decide to ignore wages when considering whether prices were overinflated? At a certain point, not even the most unscrupulous lenders, ignorant buyers, wannabe investors and greedy agents can swing a deal. The house of cards is collapsing.
Buyers need to stop being so poor! The sooner they get out there and start buying lottery tickets the sooner they will be able to afford their dream condo in San Bernadino!
If one did no deals in April and one in May, isn’t that “picking up”? even if last May the same broker did 5 deals?
Brokers need to stop painting a rosy picture for sellers. They are only hurting themselves. The quicker they convince the sellers of the new realities, the quicker they make a commission.
Sorry for being OT. I’m wondering if you folks could help me with the best sites with DATA on the housing bubble. I recall seeing a site with excellent data and charts on national prices and ratios (price/income, price/rent, etc), however I can’t seem to find it now. Also, I’d be very interested in finding the non-”bubble market” data that sigalarm has been posting piecemeal. Any help would be much appreciated–I’m trying to put together a report of housing market risks to some skeptical people and the more data I can present, the more likely I can convince them.
thanks!
lauderdalian
Here is one,
Keep in mind these are ASKING prices for properties nationally.
http://www.benengebreth.org/housingtracker/location/
If you want to knock some sense into your “skeptical people” go to
“Housing Bubble Correction
Fifteeen Years to Revert to the Mean”
January 20, 2005
http://tinyurl.com/q75r9
IMHO this is a succinct summary of the financial debacle that the world is facing.
You are right to want to look at P/E ratios. I think this is the best way to ask whether a market is “overvalued.”
This is a very good overview of US markets (warning–huge PDF):
http://neweconomist.blogs.com/new_economist/files/HSBC_frothfindingmission.pdf
I would also check out Dean Baker’s work:
http://www.cepr.net/pages/housing_bubble.htm
This sure seems funny.
I mean, there is NO (and never has been a) national housing market…
and yet each individual local market is following all the other individual markets seemingly in lockstep. Sure, a few markets seem to be slightly ahead of some others… but overall they all seem to be doing the same thing! Amazing!
Perhaps the RE market is like lemmings? There are thousands of individual lemmings. And all of them run up the cliff together. But then I forget what the lemmings do.
Up till a few months ago, it seemed we (in terms of RE) were all on top of the world! (*or at least on top of the cliff).
I forget, what happens to the lemmings when they reach the top of a cliff again???? Do they go back down the same way in an orderly fashion, making their entire trip a soft landing? Do they stand on each other’s shoulders like Cirque Du Soleil? Do they soar into the sky like Icarus
Actually, I like the idea of Icarus better. He gets SO much higher. He soars into the air, higher and higher, and if I remember correctly, he reaches the SUN, and it’s a happy ending!
Oh whatever… I’m sure the lemmings (or Icarus) will figure it out. They always do, which is why
1) there is no national housing market
2) the national housing market that doesn’t exist always goes up
I think I should work for the NAR
clouseau
Macroeconomic elements affect all sub-markets equally. When the fed overnight rates go up, others tend to rise as well. Interest rates will continue to rise as investors realize the risk factors inherent in keeping their money in US markets. This will affect all sub-markets.
Inspector C!
So true, so true. I’ve held to this belief on the way up so why not the way down? If there is no national market why were we seeing price appreciations in virtually every metro area of note (and several that aren’t)? DL has painted himself and the NAR into such a tight corner they may never get out.
The same forces are at work in all localities within the “national market.” ARMs, I/Os, the same rate structure…and these are the reasons prices rose and now will fall. Where there was more speculation, prices rose higher. But prices rose to some extent in almost all markets and will now fall.
Prices hardly budged in most of Texas. My home has barely kept up with the official inflation numbers. We may have some neighborhoods which went up 50% over the past few years, but nothing like the 200% and 300% appreciation the west coast has seen.
It’s a national psychological shift that we are seeing right now, and the effects of crazy mortgages beginning to impact the most recent aggressive buyers. Where local effects will come into play will be in seeing how much certain markets fall.
I agree that there is no national housing market, but a conglomeration of smaller markets. Phsychology and financing effect every market, but supply and demand effect individual markets.
Once the euphoria of cheap money and home prices going to the sky wears off, the underpinnings of home prices in each market will be the population relative to wages relative to availability of housing in each specific market.
How far prices fall will be different in every market.
Shiller documents this in “Irrational Exuberance”. He contends that housing mania in contagious. The growth on 24 hour news and the internet allows us to see what is happening in housing markets across the country just like they are in our own backyard. Excitement in one market more easily spills into other than any other time in the past due to the information age.
While you aptly describe the bubble as a national phenomenon, in reality it is an international phenomenon and not one that Americans created either. Much of Europe & Australia experienced the same thing.
This 24 hour/nationwide access to data has also allowed speculators to branch out of their normal areas. Think of all the Californians buying it other state because “it’s so cheap there.” They ignore the regional information and look at realtor.com to find beutiful homes at a fraction of the price they are back home. (Where they have also destroyed the prices.) They don’t care about fundamentals or incomes in those “cheap” towns.
My guess is that in the late 80’s there was not such a flood of capital to other states proving once again that …… it is different this time. (And it may actually be nation wide bubble although different areas will get hit differently. Although at least one zip code won’t fall therefore it probably won’t be “nation wide.”)
By the way:
I think I’ve found the new Moniker for the housing market that Leslie Appleton Young was looking for!!!! (if you recall a few threads back)
It’s ICARUS!!!!
The housing market is like Icarus. Flying higher and higher and higher, towards the SUN!!!! Yay!
Just like Icarus’ father was proud at what he had created (his son soaring towards the sun), we can take pride in the housing market that we have created!
Whoo hoo!
Leslie, you reading this?
clouseau
There are a lot of great comparisons to be made from the myth of Daedalus and Icarus and their escape from the labyrinth.
Daedalus (Icarus’ father) made the wings for one purpose - to escape the labyrinth. He warned his son, Icarus, that if he flew too high, the wings would fail, and he would die. Icarus, once airborne, was bedazzled by the beauty of the son, and wanted to be closer to it. But, as he flew higher, the sun melted the wax which held his wings together, and he plummeted to sea, much to his father’s dismay. Daedalus used the wings as they were intended, escaping the labyrinth by flying at a moderate height, arrived safely in Sicily.
Housing is intended to be a place for people to live, and as a side effect is a long term investment which should grow at a moderate pace. We have heard many warnings about irrational exuberance and speculation. But the housing market, fueled by greed in the form of real estate agents, mortgage brokers, and speculators went too high to be affordable. The banks tried to build better wings which could fly higher in the form of option ARMs and 50 year mortgages, but these only stalled their spectacular failure. The market will correct as these wax wings which have gone too high begin to fail, and people find themselves in forclosure.
As an aside - Daedalus was not proud of what he had created - he was humble and gave Icarus strict instruction. But Icarus was proud and thought that the rules didn’t apply to him (THIS TIME IT’S DIFFERENT!), and discovered otherwise the hard way.
Andre
Andre:
good analysis of my point. I agree wholeheartedly.
(my above posts were sarcastic, perhaps that did not show through?)
The story of Icarus is pathognomonic of our problem here IMO (which is why I chose it). You stated it beautifullly.
Thanks
clouseau.
excellent expansion/explanation of the Icarus myth.
I think it is a very fitting metaphor.
Icarus gets my vote for the replacement of soft landing.
“a side effect is a long term investment which should grow at a moderate pace.”
A depreciating durable good is NOT an investment.
No Google is ? Investment? What that word? Nobody invest today. They speculate like crakpots on dope.
Yes, but it’s better than a depreciating currency which is what has so confused the masses.
OK, perhaps not an investment, but an asset which historically has kept pace with inflation (when viewed in terms of long term averages).
Personally, I look at it as a place to live, and that’s it. But I can’t deny that it does increase in price over time when short term fluctuations are ignored.
‘Buyers are real slow pulling the trigger.’
I guess that’s why we’re still renting… not ready to shoot ourselves in the foot yet. lol.
A little unrelated, but a Boise radio station had a county commissioner on to talk about property taxes. People are ticked that appraised values are up so much in the Boise area. Last year, appraised value in Ada county (Meridian and Boise) went up $4 billion! This guy was totally on the RE/NAR bandwagon by saying housing inventory is decreasing and 3,000 people a month are moving to Ada county.
I wish I knew where these people get their numbers. According to http://www.benengebreth.org/housingtracker/location/Idaho/Boise/ inventory is UP 87% in the last six months.
Idiot homeowners want to burn both ends of the candle.
They scream for low end assessments from the assessor, but want top dollar on an appraiser’s report for their HE-LOC loan to pay off their credit card debt.
Every time I’ve said to a homeowner on a short appraisal number,
“Hey, you go get the assessor’s office to agree with the value you’ve told the L/O your home is worth, and I’ll be more than willing to do a “review and revalution” of my report.
Nobody ever seems to take me up on the offer.
How about it. I’m sick of house owners (mortgage holders) saying how pissed they are that their assessment has risen as their property valued skyrocketed. Well, if you don’t want to pay, then sell!
It’s like someone just got a huge raise, and they’re bitching about their increased income taxes. No sympathy.
It is like a staring contest. Gee, I wonder who will blink first?
We all know that no one, no one has to buy.
That is absolutely the truth.
OT:
Mish’s website has an interesting article from a Spanish writer (a few grammatical errors, but very interesting IMO)
The Spaniard posted some pics of Spain, where the young people are demonstrating for cheaper housing. (evidently 3 million out of 14 million houses are empty, yet housing is sky high in price)
My favorite picture is picture #2: it shows Snoopy lying on his doghouse, with a sign that says (in Spanish of course) “For sale, 360,000 Euros”
http://www.elmundo.es/albumes/2006/05/15/manifestacion_vivivenda/index.html
Mish’s site: http://globaleconomicanalysis.blogspot.com/
(hope that’s not against blogging rules, I’m new at this)
How long until we see protests here?
And how long after that until we as taxpayers bail out all the foolish?
clouseau
Dude, I’m so going to make snoopy signs in English and put them out near forsale signs in Norfolk and Virginia Beach.
Nassau is at 9571 on MLS, not 8,351. That number sounds about 2-3 months old.
not only are the numbers off there, I believe inventory is up more like 100% from last year, not 50% as they state - recently posted here on this blog last time LI came up…inventory jumped another couple hundred in the last day or two on mlsli, too. wow!!
Nassau is at 9,571 on MLS, not 8,351. That number sounds about 2-3 months old.
I question the entire notion of it being a buyer’s market right now. Even if prices go down 20%, anyone buying at this level is funding the seller’s retirement. So this is still a seller’s market in my book. They still win if they sell anywhere in the price range.
A buyer’s market will emerge when buyer’s are paying 1999 prices. Not before.
A buyer’s market is when prices drop below fundamentals.
OT
“Ninety percent of wealthy portfolio holders expect an 8% return on their stocks and bonds this year, but only 48% expect real estate to appreciate, down from 72% last year. Thirty-three percent believe real estate will fall, up from 14% last year. Eighty-three percent said their biggest concern is the economic future of the next generation. That is up 2% from last year.”
Robert Chapman / International Forecaster
It looks like 90% of wealthy portfolio holders must be short stocks and bonds - assuming they are going to show a profit!
this is all crazy. this soft landing spin has only lasted about 3-4 months and now it’s slowly being replaced with language that sounds an awful lot like a hard landing.
E-MAIL From REALTORS NATIONWISE TO DAVID LEREAH:
Mr. Lereah your killing us with your predictions for a comeback in 2007. The Sellers won’t lower the price . The market is dead .
DAVID LEREAH”s E-Mail RESPONSE TO REALTORS:
Don’t worry I will take care of it in a press release . I will blame it on the speculators and a correction needed of about 10to 15% to get you guys rolling again .
E-MAIL FROM REALTORS :
Mr Lereah , could you put in a word for the FEDS not to raise the interest rates at all .
E_MAIL from David Lereah to Realtors .
Sure I will put in a word , better yet ,you guys could use the increase in rates to convince the Sellers to come down and than we can get this action rolling again . I’m working on a concept of a new Spin to get them buying again .I’m going to say
“End-Users ask not what real estate can do for you , but what you can do for real estate “. I have not worked out all the bugs yet . Keep in touch .
OT but since we are getting closer and closer to a major economic event I feel it somewhat pertinent. WARNING: this article will expose the reader to “tin foil” hat theory based on facts not widely disseminated and as such could possibly lead to a personal paradigm shift.
http://www.lemetropolecafe.com/dospassos.cfm?pid=5462
Bad link, got a new one?
Sorry, the link won’t work as it will redirect to a pay site.
Here are some of the more pertinent remarks and I apologize to the folks having to scroll past these but I feel they are important to some of the folks reading this blog so I’ll post something a bit longer than appropriate since I can’t delete my previous post.
This is edited for length.
As I have often stated in papers I’ve written, INFLATION IS INDEED THE LIFEBLOOD OF ANY FIAT MONEY SYSTEM. Understanding the true meaning of this statement is vital and key to understanding so much of what we empirically experience in day to day life.
In a nutshell, in a fiat money system all “new money” is loaned into existence. Therefore, a continuously expanding monetary base is, in fact, REQUIRED to service the accumulating debt.
I’ve written about this before:
MZM Exponential Growth vs. Fed Funds Rate
The light blue vertical lines are just to point out the relationship between rates and MZM…
Rates rise and MZM contracts…Rates are lowered and MZM expands…
Debt backed by debt fractional reserve banking, to be sustained from this point means that MZM growth must grow faster and faster exponentially like it has been since the early 60’s…
Can rates be dropped past zero faster and faster exponentially faster and faster?
The answer is NO…that is impossible…
But to sustain the current reality MZM must begin moving straight up…forever…
1776 to 1991 MZM growth 2 Trillion in 215 years 1991 to 2000 MZM growth 2 Trillion in 9 years 2000 to 2003 MZM growth 2 Trillion in 3 years
So from now until the end of 2004 MZM must grow by 2 Trillion and after that it must grow by 2 Trillion in 3 months then 1 month then 1 week then 3 days then 1 day then 8 hours then 2 hours then less than an hour and so on and so forth until we are down to nanoseconds and beyond…
Or the System will collapse…the end
While interest rates have empirically risen at the short end of the curve [in the face of impossible-to-cloak rising inflation] – the liquidity pump [via repos, monetization of the debt etc.] has only accelerated. The upward sloping MZM line in the graph above IS THE CRITICAL COMPONENT. Let’s review how this manifests itself in the real world:
We experienced a miraculous “Technology Boom” in the late 1990’s. Higher equity prices, the associated leverage and multiple expansions served as life blood embellishing the monetary base.
The Fed recently discontinued its reporting of M3 money supply aggregates. This lends support as to why the Fed and its partners [The Bank of England et al] are printing their own fiat currencies to enable them to buy ever increasing amounts of U.S. debt. New money [debt] MUST CONSTANTLY BE CREATED OR THE CURRENT DOLLAR CENTRIC MONETARY SYSTEM FAILS.
This also answers another one of the world’s most perplexing conundrums; namely, why Western capital was deployed to “seed” the great industrialization miracle now underway in China. What has occurred in China has resulted from money expansion [debt] in the West - which was exported from the U.S. so as to neutralize its deleterious inflationary effects in the domestic market. It worked for a while too.
But alas, the money supply – as outlined above - still requires additional near-geometric growth – so oil prices were “SELECTED” to rise, because oil transactions settle in U.S dollars, thus DEFACTO increasing or heavily priming the monetary base for still more growth. You see folks; the story that we are imminently going to run out of arguably finite fossil fuels is just a backdrop against which the monetary base is expanded. The story is as believable as the notion that two aircraft brought down the World Trade Centre in that you can readily find “experts” that would swear both are impossibilities.
To achieve the intended end – armies have been deployed [justification for yet more debt creation] to oil producing regions to inject a risk premium to existing oil stocks. Consider the money that would not be spent if armies stayed home or if new reserves of oil were being “DISCOVERED OR BROUGHT ON LINE” all over the world? Not only would military deployments and the associated spending on the military industrial complex cease - oil prices would not rise – in fact, they might decline. This is why we’ve been given the hard sell of “Peak Oil” - that the world’s oil supplies are ‘running out’. This assertion is so believable because it has ‘strands of truth’ to it but has been artfully deployed as cover since traditional “known” supplies – namely oil located in the northern hemisphere - are indeed running out.
The suggestion that oil resources located in the southern hemisphere would actually be withheld from the market by “BIG OIL” would, of course, necessarily suggest a conspiracy or partnership between big business and big government.
There are precedents, however, for exactly this type of working relationship.
Is it a coincidence that chief Peak Oil proponent/point-man, Matthew Simmons is a member of the Council On Foreign Relations [CFR]? Is it also a coincidence that the mantra of the CFR has long been One-World Government?
The notion that multinational oil companies [largely Anglo American] would be compelled to bring new petroleum resources on line due to high oil prices and profits holds as much weight as the manner in which J.P. Morgan, Goldman Sachs et al sell precious metal. They do so by backing-up-the-truck [especially in thin markets], selling increasing tonnage of gold [to insatiable buyers like China, Russia, Iran etc.] in a market that has been rising for 7 years. More often than not, these sales are conducted in a manner which is completely inconsistent with maximizing profit?
Not to be outdone, Western Central Banks pre announce gold sales and even go as far as making public pronouncements that they “might sell gold”? The effect of this publicity serves to “mark down” the value of their existing [sovereign?] vaulted stocks. How much clearer can it get that some players/participants in the game of geopolitical financial affairs are not playing for profit as we know it [ie. maximizing revenue]?
The painful side effects of what is occurring right under everyone’s noses has been economic dislocations and asset bubbles, punishment of prudent behavior [saving] and the deteriorating purchasing power of the currency unit we all refer to as the DOLLAR. Tell tales that this is all occurring has historically been signified by a rising gold price. This is why the price of gold has been so vehemently suppressed.
Masking these ill effects has also required the sheer explosion and exponential growth of derivatives – in the realm of the unregulated – at the behest of the Fed. With institutions such as J.P. Morgan Chase now sporting an UTTERLY OBSCENE derivatives book in excess of 48 trillion in notional value [pg. 20 of 27], it begs the question; where does it all end?
One only need examine material already written and published [circa 1976] to ascertain the direct linear relationship between the Fed, The Bank of England and J.P. Morgan Chase to get a “sniff” or a sense of the scope of the complicity between these players:
“Chart 1 reveals the linear connection between the Rothschilds and the Bank of England, and the London banking houses which ultimately control the Federal Reserve Banks through their stockholdings of bank stock and their subsidiary firms in New York. The two principal Rothschild representatives in New York, J. P. Morgan Co., and Kuhn, Loeb & Co. were the firms which set up the Jekyll Island Conference at which the Federal Reserve Act was drafted, who directed the subsequent successful campaign to have the plan enacted into law by Congress, and who purchased the controlling amounts of stock in the Federal Reserve Bank of New York in 1914. These firms had their principal officers appointed to the Federal Reserve Board of Governors and the Federal Advisory Council in 1914……”
Let’s not forget that as a public company, if [any of?] J.P. Morgan Chase’s lines of business are determined to be in the “National Interest”
“The President just delegated authority to John Negroponte that allows him to exempt any publicly traded corporation that is working on national defense issues or national security issues from the reporting and accounting requirements under the 1934 Securities and Exchange Act. It’s basically the rules and regulations that require companies to keep accurate records, accurate books, accurate accounting . . . and then disclose those projects and that information to investors……”
We’ve been ‘strung’ the hollow line that this colossus provides necessary “flexibility”. Better stated, it provides a huge black curtain, behind which the biggest financial fraud ever perpetrated on mankind is being plied. Behind this black curtain, strategic commodities like oil, gas and precious metals are manipulated through the use of futures and options and an interest rate swap edifice has been concocted which serves to hold interest rates and the bond market in check.
Make no mistake; everything mentioned above only underscores how utterly toxic ANY PETRO TRADE in any currency other than dollars is to the existing world U.S. dollar centric monetary order.
History is replete with examples of how all pure fiat money systems succumb to hyperinflationary induced failure. Make no mistake; this is the Dollar’s fate.
EMail this Article
to a Friend.
That’s right, all of your paper money is absolutely worthless. Please, divest yourself of all paper money immediately! If you understand why your money is not worth anything, place all of your paper money in a large, plain manila envelope and send it to ME! I will dispose of it in an appropriate manner. I know this guy, fool that he is, who will exchange it for useful goods and services. No bills larger than a twenty, please.
History is replete with examples of how all pure fiat money systems succumb to hyperinflationary induced failure.
That’s my new bumper sticker, right next to my Jesus fish.
Our small town boy makes good!:
The man behind the Housing Bubble Blog
“Ben Jones has created an information jewel, by indefatigably excerpting from and linking to scores of articles and research papers about every aspect of the real estate industry. He’s been rewarded for his aggregation of news sources by the formation of an Internet community that hashes out each new data point or media twist in real time. It’s a classic example of how the Internet facilitates ongoing adult education. Jones provides the seed, and the community provides context, additional data and a withering critique. After reviewing the latest outburst of commentary on the Harvard study, I decided to call Jones up and get a little insight into how it all comes together.”
Congrats, Ben!
Outstanding article! Your rock Ben! You are the leader in the BubbleSphere!
David
Bubble Meter Blog
Withering and accurate critiques in this day and age are often misunderstood.
Congrats Ben! Outstanding article! I like the way the author describes our “wolf pack” as an immediate real time feedback mechanism! (Sometimes it feels more like comments from the peanut gallery) but we should take compliments anywhere we can find them. I agree though, if it were not for this form (and others) much of the NAR’s b.s would pass for gospel. Many people wonder why anyone (let alone anyone that makes decent money) would “waste” their time on a blog. I feel like I’m making money with every key stroke b/c it means time not spent looking at homes that have doubled in 5 years just b/c there has been a 5-10% correction! Plus w/ the $’s I save as a renter (vice a payment twice my current rent) it’s a pretty good deal!
I’ll add congrats to Ben, but the article wasn’t “outstanding” at all.
Salon leads off with that Harvard bubble report, cite some of its findings, and then mention some report “flaws” that were pointed out here.
(Earth shattering flaw cited: “What if the housing boom itself has been one of the main forces supporting the broader economy?”).
That was hardly the most damning “flaw” with the Harvard report, and Salon fails to mention the ‘National Association of Realtors’ et al had a hand in that report.
The most damning report “flaw” posted here was this:
http://www.jchs.harvard.edu/people/pabmemberlist.html
congrats on the article Ben!
But I agree with UnRealtor…it was mostly a crap piece totally in the style of the usual stuff on RE. The most damning report flaw indeed is the Center itself… So the tone came off like Oh, some of those bloggers disagree, with Harvard no less! Oh, some of them seem to be rooting for a hard crash, blah blah. Exactly on, Unrealtor on the earthshattering flaw comment….but at least that very reasonable retort was reported *somewhere* I guess!
And Ben got some lovely and well-deserved praise for creating and maintaining this great forum and fascinating phenomenon really, a hugely interesting and entertaining educational opportunity powered by *people* in all their splendor..
“The way I feel about it, is if people want to hear the real estate bull story the NAR [National Association of Realtors] is there every day. Newspapers until recently have been generally pro real estate or at least supporting the idea that these price levels, unaffordable as they are, can be maintained.”
I love that quote. That’s a nutshell why people have FLOCKED to this site and appreciate the job that Ben is doing. We are exhausted by the constant drumbeat of the shills and liars who are never questioned by the mainstream media in a real and substantive way. Thanks again Ben!
I’ve come to think of Ben as the Pud of the current bubble, myself. Anybody on this blog a former F*ckedCompany fan?
F*d Company site degenarated as there were too many insults and just bitterness out of some postings. This blog reminds me more of slashdot, opinionated, but having some real substance, too. Thank you, fellow bloggers!
I remember debating the RE bubble on FC way back in 2001. Of course, back then the bubble was primarily just in CA and NY/NJ. I kept the opinions and information in mind when we bought in 2002. We got a house that wasn’t a McMansion, had acreage, and had a monthly PITI cheaper than rent. Also, we avoided an ARM (against my FIL’s advice) and got an assumable loan, since we believed rates would be going up.
Good article. It should bring more visitors to Ben’s blog.
Cool.
And hopefully also to the sidelines…
As am I, a first time visitor to this site from the article.
Slightly OT, but it looks like the Fed will be raising short term rates again in a few weeks–many people are saying only 0.25%, but for the first time, I have read where some think it will be 0.5%. The inflation numbers seem to be the culprit (and within those numbers, rent inflation specifically was pretty high).
This will push short term rates (and thus ARM mortgages more expensive yet), and make renting even more attractive than buying . . . rinse, repeat.
‘Buyers are real slow pulling the trigger.’
Maybe because they realise they are playing Russian Roulette with a fully loaded gun.
Good. How can they be playing Russian roulette. They already have no brains. Their brains are already blown up.
“I have read where some think it will be 0.5%.”
I’m in that camp. They talked about it at the last Fed meeting. Inflation isn’t moderating and it isn’t within the Fed’s comfort zone anymore. And commodities spiked and are still high. Not just oil and gas anymore. Me thinks the Fed is going to 6% before the summer is over, housing market be damned !
I think that very well could be the case . . . contributing to a non-”soft landing”.
“The rapid ascent of housing prices appears to be over, at least for now, and while both sides wait for the other to budge, Islandwide inventory is rising. Regional housing inventory spiked more than 50 percent in the last year.”
as if we’re engaged in some wide-eyed mortal stand-off with the sellers. nope. i’m taking a nap. i’m not even paying attention to joe so and so’s overpriced house.
cereal,
Well exactly. In between making money and being on the phone doing sales calls I stop by and get to check in on just how bad things are truly getting! This is as much fun as you can have with your clothes on! Keep those nasty and mean spirited comments coming guys!
true, a lot of sarcasm and naysaying, but we need this to show the opposing view. i don’t think too many realtors read this blog anyway.
I think realtorspeak found their new catch-phrase for crash: “transitioning market”.
”When a transitioning market cools, it’s the sales that drop first, and then prices,” Lereah said.
This makes me sick:
And when sellers finally bring asking prices down, pent-up demand will likely result in hordes of new buyers in South Florida.
Uh, ya, hordes of foreclosure vultures, otherwise know as phase two of the housing crash. How does he do this and sleep at night?
Brokers need to stop painting a rosy picture for sellers. They are only hurting themselves. The quicker they convince the sellers of the new realities, the quicker they make a commission.
great article Ben. Congratulations. Ben and his army (all of us) RULE.
Bubble blogs for all.
Great article Ben. Congratulations. Now will someone from the media pleeeaaasse stick a fork in this “Housing Souffle’ ” to let the air out a little faster…..
Couldn’t read the article on Ben’s Blog on Salon.com w/o a subscription. However I’m thinking by the time this is over we’ll probably be seeing him on the cover of Newsweek or Time!
OT-Did the Cali contingent ever get together to meet each other?
Click on the sponsor’s logo on the Salon page. You’ll have to sit through a short advertisement and then you can read the article for free.
Concerning the So Cal bubble get together.
No I don’t think so, I would love to buy a beer for Auction Heaven and Melody, Ben Jones is always welcom and he would get whatever he wants, but the security bill would be pretty high.
I am sure that there are a lot of lurkers here, they could also be characterized as haters and it would become an ugly mess with an unemployed Realtor or Mtg broker with a gun wanting to get even with those bubble bloggers.
Rich T has gotten threats, and I am sure that Ben has as well.
It is a bitch to be a contrarian, when you are right and should brag, the sheeple want to lynch you.
Anyone have any ideas on how to make a get together work?
Congratulations Ben!!!!!
Thanks for all your hard work and efforts!!!
My prediction is main media will be calling Ben . Get ready Ben .