April 24, 2015

Concerned About Their Ability To Get Top-Dollar

It’s Friday desk clearing time for this blogger. “When discussing Wednesday’s news that existing home sales climbed in March, National Association of Realtors chief economist Lawrence Yun said the 7.8% yearly rise in March’s median price was unsustainable. ‘This price gain of near 8% is not healthy, considering people’s incomes are only rising by 2%,’ said Mr. Yun.”

“An InvestigateWest analysis shows Portland’s affordability also is being pressured by investors so bullish on this city’s single-family housing they’ve bought properties by the dozen on the heels of the recession, driving up prices and rents as they go. Across much of Portland, prices seem high, said Steve Wilson, a former project manager for multifamily remodels who has flipped homes since launching the company during the crisis.”

“Perhaps ominously, Wilson says he feels an echo of 2006 in today’s marketplace: Buyers are overpaying. Sellers want top dollar for houses that need work. And developers and remodelers are pushing prices up to $600,000 to make profits. ‘I think they’re pushing it to where we’re going to have another crash,’ Wilson said.”

“According to a Fannie Mae consumer attitudes survey, 46% of consumers think now ‘is a good time to sell’ a home — a 6-tick increase from the month prior and the highest recorded measure since Fannie Mae began tracking such data. When sellers start believing that ‘it’s a good time to sell,’ they typically believe that housing is reaching — or falling from — a peak. Falling confidence suggests that sellers are concerned about their future ability to get top-dollar which can result in home getting listed for cheaper prices.”

“Nearly three-quarters of the homes on the market are “stale,” which is to say that they have sat on the market for more than a month with little to no interest from buyers, according to from Redfin. Even in the most sought-after neighborhoods, some houses sit. In the Chevy Chase, neighborhood of Washington, D.C. one home there has been on the market since the end of February. ‘Everyone loves it; it’s the price,’ said Ghada Barakat, the Long and Foster listing agent for the property.”

“Buyer psychology and suspicion are in full swing. ‘The trust is broken among buyers. In Denver and Silicon Valley, if the house has been on the market for two weeks, there is something wrong with it,’ noted Nela Richardson, Redfin’s chief economist. ‘Everyone is afraid to overpay, and the herd behavior in the stock market is something we’re now seeing in the housing market.’”

“This year’s brutal winter seems to have landed a punch to downtown Boston’s condominium market. Condo sales for the first three months of this year plummeted 17 percent, with 495 properties sold, down from 597 the same time last year. The median selling price also slipped for the first time since 2009 to $630,000, from $660,000 last year, according to LINK, a real estate tracking firm. Debra Blair, the president of LINK, said the supply of condos on the market has become extremely tight. ‘We have no inventory in the city,’ she said.”

“An Asian radio advert is boasting that property investors can get New Zealanders to ‘go to work for you and give you hundreds of dollars a week’ in rent in Auckland’s overheated property market. The advert, aired on Singaporean radio, sells Auckland as ‘an investors’ dream’ with no land tax, stamp duty or capital gains tax. It starts by asking listeners: ‘How would you like people in New Zealand to give you around half their weekly wages? New apartments in the centre of Auckland can be purchased for as little as $390,000 — that’s right $390,000. And with as little as $2000 initial deposit you can secure one today for yourself as an investment.’”

“News of the advert has prompted opposition parties to hit out at the Government, blasting an unregulated property market for creating an ‘open invitation to the world’s property speculators.’”

“Concerns over a housing glut in Iskandar have been aggravated by new figures from the Malaysian government. It said the total number of homes in Johor state will surge by more than 335,000, or 46.7 per cent, over the next few years. The finding will only add to concerns of an oversupply in the state, which is favoured by some Singaporeans looking for a second home.”

“Maybank warned in a report last week of mounting risks to Iskandar’s already-weak property market. It said the ‘aggressive land-banking activities’ of Chinese developers in the ‘already crowded’ Malaysian development zone could make matters worse. And there is more to worry about: The National Property Information Centre said that at the end of last year, of the 13,690 housing units launched in Johor, 26 per cent, or 3,572 units, remained unsold.”

“As China’s housing market faces a sharp drop in sales, investors and credit rating agencies face an uphill task trying to calculate how much debt the country’s property developers actually hold. Unless a company holds a controlling interest in a joint venture, it can keep details of a joint venture and the debt it takes on off its balance sheet - recording instead just the amount of equity it has invested in the project. The practice is raising eyebrows now among investors trying to assess a company’s credit risk, as they worry they may have underestimated the scale of developers’ off-balance sheet debt just as China’s economic growth is slowing.”

“The shake-up of Hong Kong tycoon Li Ka Shing’s business empire provides one example of the scale of off-balance sheet joint venture debt. A new company created to hold Li’s group’s property interests - Cheung Kong Property Holdings Ltd - says in a stock exchange filing that its adjusted borrowings at the end of 2014 would have been HK$16.8 billion ($2.17 billion). That’s 11 times higher than the combined debt of HK$1.4 billion reported by the property groups of Cheung Kong and Hutchison Whampoa, even though Cheung Kong Property Holdings’ business was split between those two companies at the time.”

“Even for a country with a history of commodity booms, this one was gargantuan. Over the decade to 2013, Australia racked up $1 trillion in extra exports from the previous 10 years, thanks largely to China’s once-insatiable demand. Despite the opportunity of funding infrastructure to meet the needs of millions of new citizens, the nation largely blew the extra cash on month-to-month spending.”

“Much of Australia’s household wealth is tied up in a A$1.9 trillion private pension system, the world’s fourth largest, and a national housing market now valued at A$5.7 trillion. Yet households also carry a debt burden of 153.8 percent of income, the highest on record, and the government is struggling to restore the fiscal position as commodity prices slump and the tax system leaks.”

“After 24 years of growth, the question is whether Australia has had it too good for too long? In 1986, then-Treasurer Keating warned it was headed toward being a ‘Banana Republic,’ a statement that galvanized the country to reform. That effort prompted The Economist magazine to summarize: ‘If you look at history, Australia is one of the best managers of adversity the world has seen — and the worst manager of prosperity.’”

“Exceptional growth has been the storyline of the luxury real estate market the past few years. No other price segment has rebounded from the housing crash with as much gusto as that of million-dollar-plus homes, which are selling at twice the historical average. According to the National Association of REALTORS®, home sales above $1 million in 2014 grew nearly 9 percent over 2013 — more than double any other price point.”

“Nearly every major city — if not all of them — shattered its record for most expensive residential sale in the last year, and each one has a listing today that, if purchased at asking price, would break it again. But underneath that fanfare appears to be a little bit of nervousness that only a few will openly — or even hesitantly — admit. Is the upward trajectory of high-end sales and prices rising too fast?”

“Economists started to say last year that the potential for another housing bubble was present, but no one would go so far as to say it was actually happening. No one can say that now, either, but it’s worth noting that eerie signs — whether it speaks to a bubble or not — are popping up. And they’re starting to be acknowledged by some in the real estate community.”

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Comment by Ben Jones
2015-04-24 03:10:16

‘Yun said the 7.8% yearly rise in March’s median price was unsustainable. ‘This price gain of near 8% is not healthy, considering people’s incomes are only rising by 2%’

This income thing is getting mentioned a lot all of a sudden. Why didn’t it matter in 2012 or 2013?

‘Economists started to say last year that the potential for another housing bubble was present, but no one would go so far as to say it was actually happening…it’s worth noting that eerie signs — whether it speaks to a bubble or not — are popping up. And they’re starting to be acknowledged by some in the real estate community.’

-Graham Wood is a senior editor for REALTOR® Magazine.

There’s lots of people saying it has happened.

‘no one would go so far as to say it was actually happening’

Comment by OliverGarchy
2015-04-24 06:27:26

A cute little piece of crypto propaganda by the NAR shills. Prices are rising so so so fast even we think it might be a problem. Meanwhile get in before you are priced out forever because you got no raise coming anyway.

Comment by David Lereah
2015-04-24 06:54:09

“Meanwhile get in before you are priced out forever because you got no raise coming anyway.”

You will have a raise coming, the raise you will have coming will be in the form of increased equity.

A raise that will have no Social Security taxes extracted from it, or Medicare taxes extracted from it, or any other payroll taxes extracted from it.

A raise that will yours to keep. All of it, all of it yours to keep.

Comment by GuillotineRenovator
2015-04-24 13:30:32

Yes, another nauseating “hurry up and buy now” shill piece.

Comment by Larry Littlefield
2015-04-24 06:38:02

“Why didn’t it matter in 2012 or 2013?”

Or 2000 to 2008.

I guess he feels he can’t say “buy not or be priced out forever” again.

I think this bubble is more like the one in the 1980s, in that it isn’t nationwide. There are still places where prices are stagnant, and plenty of them.

But in the bubble markets, it’s insane, because all that excess speculation is falling on a smaller area of land.

Comment by Housing Analyst
2015-04-24 03:10:48

Plano, TX List Prices Crater 9% YoY; Housing Correction Resumes


Comment by prime+1
2015-04-24 18:11:45

Yes, however price per square foot increased and inventory is down. Bubble is still peaking in Dallas. Most people still there believe peak conditions are lasting and real.

Comment by Housing Analyst
2015-04-24 20:42:13

“Yes, however price per square foot increased and inventory is down”

And the only answer for the disparity is that those houses with a higher $/sqft include some unknown additional asset. A second house on the property?

Inventory? Given the fact there are 25 million excess empty and defaulted houses in the US, an incidental decline in inventory is simply raindrops in the desert.

Comment by Housing Analyst
2015-04-24 03:14:41

“National Association of Realtors chief economist Lawrence Yun said”…..

We know what these NAR people say and do…. they can’t be trusted. Remember this?

“Home Sales Data Doubted”


Comment by OliverGarchy
2015-04-24 06:29:26

All the housing pimps and bulls are crowing with I told you so. Meanwhile houses in my neighbor sit and sit.

Comment by Housing Analyst
2015-04-24 03:16:54

“Perhaps ominously, Wilson says he feels an echo of 2006 in today’s marketplace: Buyers are overpaying.”

And they’ve been overpaying for 15 years.

Lesson: Never pay more than reproduction costs for a depreciating asset. If you paid more than reproduction costs ($55/square foot), you got ripped off.

Comment by Blue Skye
2015-04-24 05:15:07

Are building costs starting to follow bulk raw materials costs down yet?

Comment by Ethan in Northern VA
2015-04-24 08:56:56

+ Land cost :-(

Comment by Housing Analyst
2015-04-24 19:12:33

$55/sq includes the land.

Comment by Puggs
2015-04-24 10:05:38

Last time I was in Lowe’s looking at washing machines - saw prices on the windshield of new cars on a lot and checked vacation package prices people are overpaying on LOT’S of crap.

“Retail is for $uckers” - Kosmo Cramer

Comment by Housing Analyst
2015-04-24 03:20:29

“In the Chevy Chase, neighborhood of Washington, D.C. one home there has been on the market since the end of February. ‘Everyone loves it; it’s the price,’”

Chevy Chase, MD List Prices Plummet 12% YoY; Inventory Balloons 60%


Comment by Housing Analyst
2015-04-24 03:26:17

Told you so…

“​U.S. Charges Quicken Loans With Mortgage Fraud”


Comment by Housing Analyst
2015-04-24 03:31:28

““This year’s brutal winter seems to have landed a punch to downtown Boston’s condominium market.”

Boston Metro Sale Prices Crater 14% Price Declines Loom Nationally


Comment by Housing Analyst
2015-04-24 03:48:11

“Exceptional growth has been the storyline of the luxury real estate market the past few years. No other price segment has rebounded from the housing crash with as much gusto as that of million-dollar-plus homes, which are selling at twice the historical average. According to the National Association of REALTORS®, home sales above $1 million in 2014 grew nearly 9 percent over 2013 — more than double any other price point.”

Proudly championing fraud from coast to coast…. and profiting.

Comment by Ben Jones
2015-04-24 03:59:38

‘“They say there are apartments in Pyongyang selling for US$200,000.” 

‘Jung Eun-yi, a research professor at Gyeongsang National University, was talking about how rapidly housing prices in North Korea have been rising. Jung had just returned from spending January and February in Dandong, China, where she had been tracking trends in the North Korean housing market. In July 2014, the highest price for an apartment in Pyongyang that heard about in Dandong had been US$100,000.’

‘Based on the data collected during her most recent stay in Dandong, Jung argues that there are signs that the housing market in North Korea is turning into a real estate market, rather like South Korea. If a housing market is one in which houses are bought simply for the purpose of living in them, a real estate market is formed when people start to see the houses they buy both as a residence and an investment.’

‘Jung also noted that some Chinese people have begun branching into the North Korean real estate market. Chinese residents of North Korea who were interviewed in Dandong indicated that more and more Chinese have begun investing after seeing the real estate.’

Comment by snake charmer
2015-04-24 07:17:19

You’d have to be pretty desperate to buy anything in a place where you could be expropriated, executed, or sent to a gulag at any time. Although China fits that description too.

As for the other side of the transaction, if every other country in the world is competing to attract dirty Chinese money, why not North Korea? Pyongyang, it’s the next Vancouver.

Comment by Ben Jones
2015-04-24 04:04:03

‘Last year, a Bloomberg article suggested that homebuyers avoiding chores is fueling a condo-hotel revival in the United States. Newgard Development Group and Merrimac Ventures are getting in on the revival. GlobeSt.com caught up with Dev Motwani, president of the family business, to talk about how he partnered with Newgard to develop a condo-hotel project and why the focus on Broward.’

‘GlobeSt.com: Tell us about the Gale Ft. Lauderdale. How did your partnership with Newgard Development Group come about and why did you decide to go condo-hotel with this project?’

‘Motwani: Harvey Hernandez of Newgard and I met through my brother, Nitin, long before launching the Gale. The Gale combines an existing building and a ground-up tower side-by-side, which required some creativity with regard to design, development and operations.’

‘Harvey brings expertise in condo development and I have always been impressed with his ability to think outside the box. All of this came together when Harvey recommended incorporating the Gale brand, which was a game changer for the project. Now we’ll be able to offer our residents true resort-style amenities.’

Comment by taxpers
2015-04-24 04:35:52

Condo hotel
We’re almost there
The floating condo hotel is the mark

Comment by snake charmer
2015-04-24 07:20:27

An outside-the-box game-changer that leveraged core competencies! Did they stay in a Holiday Inn Express last night?

Comment by Double Flip Triple Gainer
2015-04-24 15:58:25

Lol. The Motwanis were my fraternity brothers.

Comment by Ben Jones
2015-04-24 04:06:36

‘Manhattan may be one of the toniest markets in the nation, but even high-end buyers take a break every now and then. Sales of Manhattan homes, both co-ops and condominiums, fell nearly 20 percent in the first quarter this year, according to Jonathan Miller, author of a Douglas Elliman report.’

‘Unlike the rest of the nation, the supply of homes for sale actually gained, up 5.5 percent from a year ago, which pulled prices back ever so slightly, as well.’

‘Even the luxury market, with a median price of around $5 million, slacked off, with sales down nearly 20 percent from a year ago and prices down nearly 11 percent.’

Comment by Ben Jones
2015-04-24 04:10:30

‘Get ready for some déjà vu. The housing market this spring and summer will be similar to that of 2014, real estate experts said — meaning high prices and limited inventory.’

‘That’s especially the case in Manhattan, analysts said.’

“Heading into this spring, we’re seeing already record-high prices, at least in Manhattan,” said Alan Lightfeldt, a data scientist at the listings website StreetEasy. “Similar to last spring, prices are continuing to rise.”

‘Manhattan apartment prices fell 4%, according to data from the listings site CityRealty.’

Well, Alan the data scientist, I think you are full of you-know-what.

Comment by Ben Jones
2015-04-24 04:14:55

‘The median home value in Honolulu was $605,300 last year, behind only California’s San Jose and San Francisco among the 100 largest U.S. metro areas, according to Zillow Group Inc. With a population of almost 1 million, Honolulu has a deficit of 24,000 dwellings, including 18,000 units for families earning less than 80 percent of the metropolitan area’s median income, according to a September report for the city housing office.’

‘Demand is strong at high-end projects such as the Ritz-Carlton. More than 90 percent of the development’s 555 condos are sold, Grosfeld said. The remaining units range from studios starting at $949,800 to penthouses asking $25 million.’

“In greater Honolulu, one of the reasons for all this activity is that it’s recovered very nicely from the recession,” said Grosfeld, whose company broke ground on the second Ritz-Carlton tower in March. “Plus, you have a broad buyer base from all over the world, east and west bound and even north bound from Australia.”

‘Honolulu’s boom is “driven by U.S. customers and Japanese customers, but increasingly so also by Chinese and other Asian customers,” Taubman said. “So much of what is under construction now is being built with the expectation of increased demand from that part of the world.”

Comment by snake charmer
2015-04-24 07:26:22

Give us your tired, your poor, your … princelings and corrupt party bureaucrats.

Instead of the Statue of Liberty we need a statue of a real estate agent.

Comment by Ben Jones
2015-04-24 04:34:58

‘Dickinson, N.D.—Large signs posted on the sides of apartment buildings or staked on patches of grass, reading “rooms available” and “for rent,” are prevalent at many Dickinson complexes.’

‘The signs are a representation of tenants leaving because of the oil slowdown, which has slashed jobs and cut employee hours. The Dickinson Press advertising department listed 76 apartments listed in its Classifieds section in March 2014. Last month, there were 134 listings.’

‘An increase in listings means more vacant apartments. And vacancies ripple through the market.’

‘While the slowdown has affected connections, Fitterer is optimistic about the future. She said the boom brought more businesses to the area, which had led to more people being able to find employment. “There are still jobs here,” she said. “They are just changing.”

Comment by Combotechie
2015-04-24 06:04:43

“She said the boom brought more businesses to the area, which had led to more people being able to find employment. ‘There are still jobs here,’ she said. ‘They are just changing.’”

But Wiki says this about Dickinson:

“Since the North Dakota oil boom the city has become one of the fastest growing cities in the United States. The city according to the 2013 census is estimated to have a population of 20,826, however, other sources have estimates of the population at 26,771 or possibly exceeding 30,000. The rapid growth of the city has led to an increase in crime and homelessness within the city limits.”

This was as of the 2013 census, when the boom was still booming.

Comment by rms
2015-04-25 04:44:27

“There are still jobs here,” she said. “They are just changing.”

Wanna super-size the french fries?

Comment by Ben Jones
2015-04-24 04:37:24

‘Colorado is in the middle of the U.S. pack when it comes to foreclosure filings in March, according to RealtyTrac’s monthly foreclosure report.’

‘The state recorded a total of 1,466 foreclosure filings in March, or one for every 1,516 households – up about 26 percent from February and up about 7 percent from March 2014. And if you look at the first quarter of 2015 and compare it to the last quarter of 2014, the filing numbers are up by 56 percent, according to the report.’

‘Some of the increase can be attributed to the delay in foreclosure proceedings last year when former state Attorney General John Suthers filed eight separate civil lawsuits against Colorado foreclosure law firms, mostly related to inflated foreclosure costs.’

“Some of the law firms went out of business, [and] there was a lull in foreclosure activity,” Blomquist said. “The increase we see is some of the banks catching up on foreclosures delayed by that fiasco.”

Comment by Ben Jones
2015-04-24 04:42:58

‘One-quarter of homes with a mortgage in the Chicago area, and almost 24 percent in Illinois, are “seriously” underwater, meaning homeowners owe at least 25 percent more on the loans than the property’s value.’

‘Breaking Business Americans’ interest in buying home at an all-time low

‘See all related U.S. new-home sales collapse in March’

‘The report from RealtyTrac, which shows the percentage of underwater homeowners growing in most parts of the nation, helps explain why more homes are not coming on the market, despite the desires of would-be sellers. They simply don’t have the equity in their properties to be able to sell them unless they bring cash to the closing table or get approval from their lender for a short sale.’

‘Also driving up the percentage of underwater borrowers is the slowing rate of appreciation that many housing markets are seeing, a trend that economists say is a return to more normalized boosts in housing prices. In the Chicago market, median prices of home sales in March posted a dramatic year-over-year spike after eight months of flat or declining prices.’

‘Underwater Chicago-area homeowners can at least take some solace in the fact that residents in other markets, like Orlando and Lakeland, Fla., and Akron and Cleveland, Ohio, are even more underwater.’

‘Also Thursday, real estate brokerage Redfin reported that while new listings continue to be added to the market, the vast majority of homes listed for sale have been on the market for at least a month. Nationally, new listings rose 9.2 percent last month but 70 percent of all listings were at least 30 days old.’

Comment by rj chicago
2015-04-24 10:31:08

Ben - you gotta live here to believe what has been going on.
A bit of on the ground info for you….here in the Chicago area of ILLANNOY……
Ran into an old neighbor a couple weeks back from the former nabe my wife and I lived in up til three years ago when we decided to move to get her closer to cancer treatment. Sadly did not end well….but mind you GOD is GOOD all the time.
Old nabe - nice street - newer homes all built after 2000 in a PUD in the west burbs of Chicago called Thornwood - St. Charles / South Elgin. Backed onto a bird estuary / 150 year old oaks - total number of homes on the street are 50. I think you get the picture.
Anyway - when we were there we saw year after year before the crash prices going up and up sometimes in double digits YOY. Then the crash. The worst was 08/09 when 10 of the 50 homes were in foreclosure. Panic set in - people including us sold at a loss / taxes through the roof in beloved Kane Co. and remain this way - yep the assessor may agree to a market price reduction but what do they do - they just jack up the levy.
Long story short - my old neighbor says another half dozen homes are now up for sale this spring - mind you most homes on the street have gone through at least one if not two owners. I suspect that everyone continues to not even break even on purchase price - and taxes are chasing the folks away. So…even at lower prices these newer owners are finding they are underwater. Just makes me wonder more and more what the real truth is out there. The house across the street from our former home is still vacant - now 5 years and is literally falling apart. Irony is that it was owned by a woman who was a mortgage broker at a major bank here in Chicago.
I continue to hear that this is fairly typical in newer developments in the far west burbs and as I ranted a while back here on the HBB - unless local municipalities get their spending under control these high tax areas are gonna crater - the old street is but a microcosm of this.

Comment by Ben Jones
2015-04-24 04:45:50

‘Shares of homebuilder PulteGroup on Thursday sank to their lowest level since November after the company reported first-quarter results that missed views due to fewer closings in what its CEO called “a sustained but slow recovery” in the housing market.’

‘Shares caved 7.7% to 20.03 in the stock market today, a fall likely compounded by the 11.4 % drop in U.S. new-home sales for March reported by the government Thursday.’

‘PulteGroup’s gross margin on home sales fell to 22.7% from 23.8% a year earlier, partly reflecting last year’s purchase of real estate lots from homebuilder Dominion Homes catered to entry-level customers.’

‘In contrast, however, rival D.R. Horton said in its Q1 report Wednesday that orders jumped 30% and backlog rose 21%. Still, Horton shares continued a slide that began yesterday after the company reported slower sales growth in more lucrative luxury homes compared to its starter homes.’

‘New orders for PulteHomes gained in most regions but fell in its large Texas market. CEO Richard Dugas said during the company’s conference call that sales sank there because it was finishing building two communities in Austin and San Antonio.’

‘Demand in Houston, however, was flat, Dugas said, and the company said demand in more its higher-priced offerings in Houston was decelerating.’

‘Homebuilder Lennar also said in reporting Q1 results that incentives and higher costs cut into margins in the first quarter and that new orders fell in Houston, which made up a large chunk of its orders last year.’

Comment by OliverGarchy
2015-04-24 06:34:22

Somebody here is lying about new home sales. The only way to tell the truth on any of this is to waste a couple of hours going to a new home builder site and seeing what concessions you can get from them. The more they are willing to throw in or cut price the worse the demand.

Comment by Ben Jones
2015-04-24 05:08:22

‘High demand and limited stock have prompted housing and condo prices to soar in the metro Boston area. Immediately after the housing bubble burst in 2008, prices for homes stalled for several years.’

‘But since 2011, West Roxbury and Roslindale have seen multi-family home prices soar by more than 40 percent. North of the Charles, Cambridge and Somerville multi-family prices have surged around 50 percent during that time. And in metro Boston towns Watertown and Brookline, condo prices rose more than 23 percent.’

‘In Roslindale, multi-family housing prices increased 40 percent between 2011 and 2014. But with no easy public transport to Boston, the neighborhood remained far more affordable than Somerville and Cambridge with multi-family homes selling on average at $490,000.’

‘Multi-family homes in West Roxbury rose 20 percent during that time and with sales prices at $517,250 on average.’

“We started to see some teeth in 2012,” Charles Cherney, vice president of Hammond Realty in Cambridge who sells homes in Somerville and Cambridge. “Now in 2015 we are in the third year of a hot market… The market is trying to catch up for the long periods of stability.”

‘The market has led to floods of buyers vying for limited number of properties hitting the market, forcing buyers in Somerville and Cambridge to fork-up full payments made in cash up front and forgo contingencies such as home inspections when buying a home, Cherney said. Recently, Cherney’s agency sold a one-bedroom condo along Broadway outside Central Square with no parking for about $100,000 over asking price.’

There has to be some kind of a prize for coming up with a line like this:

‘The market is trying to catch up for the long periods of stability’

Comment by Ed
2015-04-25 05:34:15

Boston is a shitshiw right now. A bifurcated market; the poor immediate suburbs of Boston like Chelsea and Everett are languishing pricewise; the richer neighborhoods of Arlington, Somerville, Cambridge are absolutely bananas. Hardly any inventory and houses selling for $100k over asking. West Roxbury and Roslindale used to be the parts of Boston where blue collar workers like firemen and cops lived; now houses are over $500k in these areas. If you aren’t bidding the first open house weekend, you aren’t getting the house. Language like “all offers due by” are in all listings. The condo market is a bit saturated but young professionals are often picking condos because SFH are so outrageously priced.

Comment by Housing Analyst
2015-04-25 06:35:57

Easy answer; Rent for half the cost of buying. Buy later after prices crater for 65%.

Comment by Ben Jones
2015-04-24 05:12:04

‘The slow pace of homebuilding will hurt California by driving millennials out of state to buy, according to the CEO of the California Association of Realtors.’

“They’re not going to be a ‘lost generation’ in terms of housing,” Joel Singer of CAR said. “They’re going to be a lost generation for California.”

‘Singer’s market outlook at the association’s legislative week in Sacramento provided some evidence. State gaps in affordability, rate of home ownership and housing production could push millennials, once they’re in full homebuying mode, to look outside of California, he said.’

‘In a series of charts, Singer showed an increasing gap between rates of home ownership between younger buyers and older ones, and how the minimum income needed to buy a home has soared in the last two years, particularly in large metropolitan areas, by about $35,000.’

“This is something we did to ourselves,” Singer said. “What we needed was price stabilization in real estate,” he said, referring to the soaring and then plunging prices of the last decade. “What we got was less production.”

‘But Singer’s outlook didn’t just focus on home sales. Rents, too, have risen, and continue to hamper lower-income residents who might want to own someday. “Affordable rents position people to buy affordable homes,” he said. “And in California we have neither.”

Comment by Professor Bear
2015-04-24 05:58:39

But we do have myriad Save Our Homes bailout programs to keep homeowners who bought at bubble prices housed, plus open access to foreign speculators.

And the notion that there is/was no building of new homes is a pile of coca. Building went into overdrive before the bubble burst, and it’s rsmping up to do the same right now. The problem is that too many houses are owned by outside investors who overpaid and by geriatric householders who would move except they can’t afford to lesve behind their low monthly payments.

Comment by Ben Jones
2015-04-24 06:14:04

‘a pile of coca’

Bill Clinton’s news alerts probably went off when you posted that, but I know what you meant:

“‘Lame income growth and weak demand from first-time buyers are big reasons why home sales aren’t stronger, economists said Tuesday. ‘It’s strictly a matter of low demand,” said David Crowe, chief economist of the National Association of Home Builders. ‘There’s a significant lack of first-time home buyers.’”

“David Blitzer, index committee chairman at S&P Dow Jones Indices, chimed in that a lackluster labor market is holding back home sales. ‘If wages were growing faster, you’d have…more people buying houses,’ he said. Weak home sales are ‘much more of an income problem than a credit problem.’”

“But the U.S. economy is growing too slowly to help out housing much, Blitzer added. ‘Housing, unfortunately, is one of the sectors that shows this slowness and this weakness and this lack of recovery,’ he said. ‘If a lot more people wanted to buy houses, someone would figure out a way to build them.’”


Comment by AmazingRuss
2015-04-24 12:41:56

Somebody ate the children.

(Comments wont nest below this level)
Comment by Cactus
2015-04-24 09:37:46

‘The slow pace of homebuilding will hurt California ”

build more homes we have plenty of water

Comment by Ben Jones
2015-04-24 05:21:38

‘Auckland landlords are calling for greater scrutiny of overseas property buyers to address the stress they are creating on the Auckland housing market.

The Auckland Property Investors’ Association President Andrew Bruce suggests there is anecdotal evidence of foreigners buying up property here and leaving it vacant. “If it genuinely is the case that a huge amount of overseas money is coming in here and just buying up properties and leaving them vacant, like some people suggest, that’s obviously an issue.”

‘Bruce holds that if unfettered foreign ownership of our properties continues to be unchecked, we will be in danger of creating another bogey monster that will haunt the Auckland property market for years to come. “We try and get a return off the money - i.e. rent the properties out and get tenants in there so you’re buying a home for someone. But they’re just buying something and leaving properties vacant. That’s not really achieving a lot for New Zealand.”

Comment by Professor Bear
2015-04-24 05:42:35

“News of the advert has prompted opposition parties to hit out at the Government, blasting an unregulated property market for creating an ‘open invitation to the world’s property speculators.’”

Sounds as though the NZ government sold out its households to foreign speculators the same way the US government did.

Comment by Ben Jones
2015-04-24 11:59:43

‘Foreigners who came to Brazil in boom times flee the bust’

‘Inflation and unemployment are spiraling, and the local currency has lost value, driving up already high living costs. Add to that a kickback scandal that has hand-cuffed Brazil’s biggest company, the state-run oil firm Petrobras, and a burdensome bureaucracy and it’s not surprising that Brazil’s shine is fading.’

“There are so many factors that have sunk the country,” Lecourieux said. “Today the market is very pessimistic. Few deals are taking place. Insecurity is up as well. People are more frightened than they were a while ago. It’s very complicated.”


Everything’s coming up roses when you are enjoying a bubble. Afterward, not so much.

Comment by snake charmer
2015-04-24 15:40:15

Interesting. Where’s Rio today? I’ve commented here before on reports of young Portuguese professionals moving to Brazil or Angola because of high unemployment in their home country.

In the future, will it be a luxury just to have a paying job somewhere?

Comment by AmazingRuss
2015-04-24 12:30:01

“The advert, aired on Singaporean radio, sells Auckland as ‘an investors’ dream’ with no land tax, stamp duty or capital gains tax. It starts by asking listeners: ‘How would you like people in New Zealand to give you around half their weekly wages?”

I wonder how Kiwis react to that ad?

Comment by rj chicago
2015-04-24 13:42:14

Wait for it……all bets are off now…..Radian now offering an industry first – job loss insurance. New program will pay borrowers’ mortgage if they lose their job


Comment by Bluto
2015-04-24 13:53:14

Thanks much for the #2 link to the article on Portland, people shut out by cash buyers, etc… Interesting stuff, well written and not the usual realtor fluff that most papers pass off as journalism…was not aware this was going on in Portland this late in the game, I had a similar experience in Calif. in 2012.

This bit from the article is especially interesting…and ominous.

“Others are overbidding to ram deals through quickly, then waiving the right to negotiate price if an appraiser doesn’t agree. The practice comes with significant risks. It also allows the next guy to price his house just as high, while one sale becomes a benchmark for the starting price of the next, Hagstette said.

“The ultimate effect is it’s taking away any sort of price cap,” Hagstette said. Our marketplace? “In a sense, it is unregulated by appraisers.”

Comment by Ben Jones
2015-04-24 16:55:56

That was an important part. A note to those who may not know; I purposefully leave out good information so as to encourage readers to go to the links and finish what’s there. That keeps the media happy and besides, I couldn’t possibly cover everything in an article that well written.

Comment by Florida Skeptic
2015-04-24 17:24:22

People in Palm Beach County, Florida believe that their property values are rising again. The construction beavers are filing their permit application and getting busy. But sales for the first quarter of 2015 look bad. And you cannot blame the cold weather. The sale price has not dropped but the number of sales recorded to date are only 73% of the 2014 average and 82% of the sales for Q1 of 2014.

But Zillow predicts the housing prices will go up 1.4%

Maybe the sales record clerk is on vacation.

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